Dogecoin kicked off the month with a strong upward trend, breaking through the resistance levels it faced in October. The price of DOGE saw an impressive rise, but the momentum was temporary, meeting new hurdles shortly after. Nonetheless, even as Dogecoin struggles with validating a clear upward move, promising signals emerge from its on-chain metrics, suggesting a renewed bullish potential. With holder support strengthening near its support levels, Dogecoin is preparing for a price breakout.
Dogecoin Becomes Sandwiched Between Crucial Levels
Dogecoin met with a strong pushback at the $0.076 level, which led to the sell-off of long positions amounting to more than $3 million. Despite a rising downward trend, investors are showing recovery by strengthening their support as the memecoin dips. This development is supported by on-chain data, suggesting a potential recovery for Dogecoin’s value.
The price of DOGE has been trading in a narrow range as it faces strong buying and selling pressure from different groups of investors. The popular cryptocurrency based on a dog meme is trapped between two key levels of demand and supply, according to analysis.
Data from IntoTheBlock reveals that the lower level is a zone where 212,000 addresses hold 14 billion Dogecoin, ranging from $0.0718 to $0.0738. The upper level is a zone where 78,800 addresses hold 9.2 billion DOGE, ranging from $0.0745 to $0.0765.
If the holders near the support zone keep holding their DOGE, they might overpower the holders at the resistance zone and push the price higher. This could lead to a bullish breakout for DOGE in the coming days.
Currently, the trading sentiment for DOGE price is turning bearish, with the long/short ratio declining toward 0.8172. More than 55% of positions are now betting against a price increase.
What’s Next For DOGE Price?
The price of Dogecoin recently rebounded from the 20-day EMA at $0.071, showing a shift in mood from selling on highs to buying on lows. As of writing, DOGE price trades at $0.0736, surging over 1.3% from yesterday’s rate.
The bulls are attempting to keep the price above $0.07, and if they manage, the DOGE price could gain speed and rise to $0.076. This level could be tough resistance, but if broken, the price could soar to the crucial monthly resistance of $0.084, where bearish pressure might dominate.
With the EMA trend lines rising and the RSI level holding its momentum above the midline, the sentiment might switch toward buying, and short-position holders might soon get trapped near resistance levels.
On the other hand, the bears will not give up easily. They will try to stop the rally and drag the price below the 20-day EMA. This could open the door for a possible drop below $0.065 and consolidate the price near $0.06.