Dogecoin (CRYPTO: DOGE) is poised for a short-term recovery to new highs if the daily price low holds, a new technical analysis by DD Trading On X (former Twitter) shows.

What Happened: According to the analysis, Dogecoin has just moved into a key demand zone after experiencing a 10% drop from former highs.

After establishing range lows, triggering a liquidity sweep, and touching the high-demand zone, where buyers tend to step in heavily, Dogecoin broke its short-term bearish structure, forming a higher high. This move swept out weak hands before the price reversed upward.

>DD: "After a 10% drop from former highs, $DOGE moves into a key demand zone.

What happened:

- Price established range lows, triggered liquidity sweep and touched a high demand zone (yellow). At this zone, buyers used to step in heavily.

- From this zone, Doge broke its short-term bear structure (red lines) forming a higher high. This move swept out weak hands before price reversed up.

The subsequent reversal in the Dogecoin price had led to the formation of a statistically strong daily low, the analysis stated.

The cryptocurrency also broke a lower time frame structure, shifting from a downtrend to an upward trend, suggesting short-term bullishness.

However, the larger market structure remains neutral-bearish unless higher resistance breaks.

Currently, the Dogecoin price is yet to breach resistance levels near $0.235-$0.24, where a significant liquidity pool, marked as "$$$ on the chart, is likely to attract sellers or trigger further buying pressure. This is near the $0.23 level, where Dogecoin previously got rejected.

The statistical panels at the bottom of the chart provide insights into the likely price behavior based on historical patterns.

According to the data, there is a low probability, around 16.5%, that the current daily low will be revisited or broken again, which increases the odds of a bullish move.

Additionally, the chances of Dogecoin forming a new daily high later are high. Historical data shows that in approximately 88.6% of similar cases, a new high forms. This finding supports the broader expectation that a price bounce is imminent.

The crypto trader also pointed out that a massive liquidity pool is present above the $0.23-$0.24 resistance. A breakout above this zone could propel Dogecoin toward the $0.30-$0.32 area, where another substantial liquidity pool awaits.

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Dogecoin Price Action: At press time, Dogecoin is priced at $0.21, up 0.25% over the last 24 hours. The digital asset has seen a slight decline of 1.16% in the seven-day period.

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