Dogecoin (CRYPTO: DOGE) staged a modest recovery on Monday, with its price holding above the critical support level of $0.225. This comes after a minor 5.8% pullback on Sunday, May 11, following several days of double-digit gains.

The popular meme cryptocurrency was down by 0.8% over the past 24 hours, trading at $0.2341 at press time. Despite this short-term correction, technical indicators remain positive.

Most notably, the 5-day Relative Strength Index (RSI) showed a decisive crossover that occurred on May 7. This technical pattern, where the shorter-term momentum line (at 71) crosses above the longer-term signal line (at 59), typically suggests continued upward movement.

Trading Volume Drops

Trading volume saw some decrease, dropping from $4.5 billion to $3.5 billion in the past 24 hours. This indicates that investors may be taking a more cautious approach while awaiting clearer market direction.

The derivatives market painted an interesting picture of Dogecoin’s current standing. Total open interest fell by 7.29% to $2.80 billion, while daily trading volume contracted by 19.55% to $7.74 billion.

Perhaps most telling was the liquidation data showing $20.15 million in total DOGE positions were wiped out over the past 24 hours. Out of this, about 75% were long positions, indicating that over-leveraged bullish bets were cleared when prices dipped below $0.25.

The Technical Picture

The current price structure for DOGE remains intact as long as the $0.225 support holds firm. Earlier in its rally, the cryptocurrency had established a clear higher low (HL) structure, which was later followed by a new local higher high (LH), reinforcing a developing bullish sequence.

This pattern, combined with continued support above the lower bound of the SuperTrend at $0.191, suggests that the broader upward structure remains valid. The movement is likely to resume upward if the current consolidation resolves positively.

Chart patterns show DOGE approaching a key resistance area around $0.25. Breaking through this level with strong volume could trigger a move toward the $0.30 zone, according to several market analysts.

The current setup appears particularly promising because there is a lack of social media attention on Dogecoin. Some traders view this relative quiet as a contrarian indicator, potentially signaling a calm before the storm.

Bitcoin’s Price Action Continues to Influence

Bitcoin (CRYPTO: BTC) continues to have a strong influence on Dogecoin’s movements. As long as Bitcoin maintains positions above $104,000, DOGE has a greater chance of resuming its upward trajectory.

Recent positive developments include Donald Trump’s confirmation of successful trade talks with China, which helped push Bitcoin to new heights. However, geopolitical tensions, particularly between India and Pakistan in the last 48 hours, dampened enthusiasm for more volatile assets like memecoins.

Strategic traders are now watching for Bitcoin ETF flows and upcoming U.S. macroeconomic data releases this week. If institutional appetite for crypto remains strong, meme coins like DOGE could quickly resume their upward momentum.

The risk remains tilted to the downside if Bitcoin fails to hold above $100,000. A drop below $0.225 could trigger another round of liquidations, temporarily invalidating the bullish thesis.

Long/short ratios provide a mixed view of market sentiment. While account-based ratios on major exchanges show moderate bullish positioning at around 2.8, the top trader long/short position ratio exceeds 5.00, suggesting high conviction from larger market participants.

The price correction we’ve seen appears to be part of a healthy market cycle, allowing for profit-taking after rapid gains. With current support levels holding, many analysts believe DOGE is simply taking a breather before its next leg up.

For the week ahead, a daily candle close above $0.25 would be a key confirmation of renewed momentum, particularly if accompanied by increased trading volume.