Dogecoin Pauses Rally but Bullish Structure Suggests Bigger Move Ahead

The recent retracement in Dogecoin's price, while noticeable, hasn't fundamentally altered its overall technical outlook. In fact, several analysts suggest that the next significant breakout could be the most pivotal one in recent months.

Short-Term Dip, Long-Term Signal

Despite DOGE's slightly underperforming the broader cryptocurrency market in the short term, a noteworthy "golden cross" formation – where the 20-day moving average crosses above the 200-day moving average – persists. For market observers like Ali Martinez, this enduring pattern is sufficient to maintain a bullish perspective. He anticipates a potential rally towards $0.70 if the cryptocurrency can successfully overcome the crucial $0.36 resistance level.

Reasons for the Market Pause

This recent pullback occurred following the introduction of over 95 million DOGE into circulation through a scheduled unlock, amounting to approximately $22 million in value. Although this addition represents only a small percentage of the total supply, its timing amplified its impact. Daily trading volumes experienced a sharp decline, liquidity decreased, and broader market liquidations exceeded $136 million, contributing to further downward pressure. Social sentiment also waned, with Dogecoin's dominance in cryptocurrency-related discussions decreasing by over 22% in the past month.

Indicators Suggest Renewed Momentum

Despite the headwinds, momentum indicators suggest that bullish sentiment remains. The MACD (Moving Average Convergence Divergence) has crossed into positive territory, and the Relative Strength Index (RSI) is currently around 67 – a high level, but not yet in overbought territory. If DOGE can sustain support around its current price levels, a recovery towards the mid-$0.30 range could pave the way for a potential surge to new highs.

For the time being, traders are closely monitoring whether this period of consolidation will serve as a launchpad for future gains, or whether it marks the beginning of a more extended cooling-off period.

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