DOGE gains just over 1% in the past 24 hours, Memecoin could be set for a breakout that could push it up to $0.134
Over the past week, many meme coins have recorded significant losses. This included Dogecoin (DOGE), a cryptocurrency that fell 12.4%.
On the contrary, in the past 24 hours, DOGE has recorded some gains on the charts. In fact, at the time of this writing, Dogecoin was trading at $0.109.
Needless to say, the general price trend of meme coins has been a hot topic among cryptocurrency analysts. One of them is Kevin Capital, whose analysts cite the downtrend macro wedge to predict upside potential on the chart.
Dogecoin market sentiment
In his analysis, Kevin claimed that Dogecoin’s latest price action shows signs of a possible bullish recovery after peaking above the macro downward wedge trend of the past 48 hours.
Source:X
According to this analysis, the 48-hour recovery indicates that the recent decline may be a false bearish signal, and DOGE is currently undergoing a bullish backtest. Therefore, a successful backtest confirms that the wedge trendline holds as support, leading to an upward breakout.
Typically, a descending wedge is a typically bullish reversal pattern that occurs during a downtrend. This trend indicates that selling pressure is waning and a breakout to the upside may be imminent.
Historically, a breakout from this trend is considered a bullish reversal, especially after an extended downtrend. Once it forms, it means buyers may be in control.
For example, in 2021, Dogecoin experienced a parabolic rise in the so-called meme-driven bull market. During this period, DOGE soared 1333% in two days to reach $0.0459. This continued to be a bullish move, with DOGE soaring 10,531% in 100 days and ATH hitting $0.70.
Therefore, if this analysis holds true, DOGE will gain significantly on the price chart.
What does the chart show?
As we observed above, the current market situation could push Dogecoin higher in the short term.
Source: Santiment
First, Dogecoin’s DyDx exchange funding rate has remained positive for the past week.
This means that long position holders are paying for their shorts during market declines in order to maintain their positions. Such market movements are a sign of confidence in the memecoin’s prospects.
Source: Coin Glass
This long position demand is further supported by a positive open interest (OI) weighted funding rate.
Source: Into the Block
Additionally, net flows among large holders surged from a low of 37.43 million to 563.1 million over the past week. This surge means many large holders are increasing their investments and holdings, rather than exiting to sell. This is a sign of confidence among large holders who are expecting further price increases.
Simply put, Dogecoin is currently at the end of good market sentiment. If these conditions hold, DOGE will break through the stubborn resistance level at $0.11105. Upon breaking this level, Memecoin will reach $0.134.
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