Dogecoin price analysis: A breakout from the inverted head-and-shoulders pattern could push the DOGE price up 48% to reach $0.3830. However, if the price closes daily below the 23.60% Fibonacci level, then this bullish scenario will be canceled.

Dogecoin price showed resilience as it remained above the $0.20 psychological level amid Bitcoin’s price holding above $109,000 and the crypto market capitalization testing the $72 billion mark again.

Among the top 10 coins, Dogecoin displayed the strongest recovery with a 4% gain in the last 24 hours.

Dogecoin Price Analysis: Key Ema Levels

On the daily chart (26/5), Dogecoin formed a bearish engulfing candle pattern on May 23, indicating a decline of 8.29%.

This decline tested the potential breakout of the inverted head-and-shoulders pattern, as the price pulled back from the long-term resistance trendline.

Nonetheless, Dogecoin is still holding above the 23.60% Fibonacci retracement level at $0.2179, which is reinforced by the price rejection at the lower level.

On Sunday, a long-tailed doji candle was formed, and currently Dogecoin is trading at $0.2266, showing a daily gain of 0.82%.

Furthermore, the price remains above the 200-day EMA, which aligns with the 23.60% Fibonacci level. Despite the short-term weakness, the underlying bullish sentiment still favors a potential breakout rally.

The 50-day EMA and 100-day EMA lines also point to a possible bullish crossover. Meanwhile, the RSI indicator remains flat above its midpoint, suggesting a potential reversal with room for further growth.

Dogecoin Price Prediction: DOGE Target Price

Based on Fibonacci levels and the inverted head-and-shoulders pattern, a successful breakout could push the Dogecoin price towards the $0.3830 level, which represents a potential upside of 48%.

However, if the price closes daily below the 23.60% Fibonacci level, then this bullish scenario will be canceled.

In that situation, the nearest support is at the 50-day EMA line around $0.20, and the next support is at the $0.14 level.

Dogecoin Derivative Data Supports Bullish Signals

Although Dogecoin is at a crossroads due to the failure of the short-term uptrend, the derivatives market still shows optimism.

According to data from Coinglass, Dogecoin open interest increased by 7.44%, driven by an overall market recovery that pushed the total value to $2.70 billion. This indicates increased trader activity on Dogecoin, which was also supported by an increase in the funding rate to 0.0081%.

The increase in open interest and funding rate reflected the growing bullish sentiment among derivatives traders who were anticipating a potential breakout rally. Options volume also surged by 60%, with open interest in options reaching $300,000.

In the past 12 hours, Dogecoin’s price recovery has triggered a $2.4 million liquidation of short positions, while 24-hour liquidation data remains balanced.

Overall, data from the derivatives market continues to support the bullish narrative, reinforcing the potential for a breakout.