Dogecoin's recent 5% pullback from $0.07862 appears temporary as multiple technical and cardano (ada)fundamental factors align for potential upside.
Growing network activity and whale transactions suggest accumulating interest that could propel DOGE toward $0.08153 resistance.
The bullish scenario becomes invalid only if DOGE decisively breaks below the $0.06756 support level.
Since mid-October, Dogecoin has demonstrated remarkable resilience, bouncing from the $0.05694 support level amid broader market recovery. While recent profit-taking caused a temporary setback, underlying metrics suggest this meme cryptocurrency might be preparing for its next upward leg.
Technical Setup Favors Dogecoin Bulls
The current price action shows DOGE consolidating between $0.07677 and $0.08039, a zone that previously acted as supply barrier. Despite the recent rejection, several technical indicators maintain their bullish configurations. The Relative Strength Index (RSI) continues holding above the critical 50 level, while the Awesome Oscillator (AO) remains in positive territory - both suggesting underlying strength in the market structure.
Should buying pressure intensify, Dogecoin could first target the $0.08153 resistance level, representing approximately 10% upside from current levels. In an extended bullish scenario, the cryptocurrency might challenge the psychologically important $0.08500 and $0.09000 thresholds.
Network Activity Signals Growing Interest
On-chain metrics paint an increasingly optimistic picture for Dogecoin. Daily active addresses continue their upward trajectory, indicating expanding network participation. This growth coincides with increasing stablecoin market capitalization and deposits, suggesting fresh capital entering the crypto ecosystem that could flow into DOGE.
Total open interest in Dogecoin futures markets has been climbing steadily, reflecting growing trader engagement. Perhaps more significantly, whale transactions (both above $100,000 and $1 million thresholds) show heightened activity from large holders - often a precursor to notable price movements.
Analysis of the In/Out of the Money Around Price (IOMAP) metric reveals substantial support between $0.070518 and $0.074543, where approximately 377,620 addresses hold nearly 58.02 billion DOGE. This concentration of buyers could provide a strong foundation against downward pressure while creating potential springboard for upward moves.
While the overall outlook appears constructive, traders should remain aware of potential risks. A breakdown below $0.06756 would invalidate the bullish scenario, potentially opening the door for a retest of October's lows near $0.05694. Market participants should monitor these key levels along with the evolving on-chain landscape for confirmation of the next directional move.
