Dogecoin price has recovered to test the 100-day EMA at $0.20. A breakout from this level could spark a major trend reversal and open the door for a fresh bullish phase.

On the daily chart, Dogecoin has shown strong support at $0.14, making several attempts to break through the $0.20 resistance zone. This struggle, along with increasing bullish momentum, has led to the formation of an inverted head-and-shoulders pattern.

The pattern’s neckline coincides with the psychologically significant $0.20 mark. Additionally, a 15% jump on May 8 formed a large bullish candle, surpassing the 50-day EMA at $0.1795 and the 23.60% Fibonacci retracement level at $0.1869.

Currently, both the neckline resistance and the 100-day EMA at $0.20 are being tested by Dogecoin. A breakout from this level appears imminent and could be pivotal for the next major move.

If the buyers succeed in pushing through the neckline resistance, it could spark a major trend reversal and initiate a fresh bullish phase.

On the downside, the 50-day EMA at $0.1795 provides crucial support.

Dogecoin Price Levels To Watch

The 38.20% Fibonacci level sets an immediate price target at $0.2227. In a more optimistic scenario, a breakout from the inverted head-and-shoulders pattern could propel DOGE to the 61.80% Fibonacci level at $0.2957, suggesting a potential 45% rally and a possible retest of the $0.30 mark.

71% Of Binance Traders Anticipate DOGE Breakout Rally

As Dogecoin gains momentum, sentiment in the derivatives market remains highly bullish. Open interest has surged nearly 17% to $2.11 billion, while a funding rate of 0.0102% reflects aggressive bullish positioning.

According to Coinglass, the long-to-short ratio has seen significant fluctuations over the past 12 hours. However, the bullish narrative currently dominates, with long positions comprising 52.02% of trades, bringing the long-to-short ratio to 1.0842. This indicates increased odds of a bullish continuation.

On Binance, the bullish narrative peaks with long accounts rising to 71.05%. Hence, traders anticipate a breakout rally in Dogecoin for an extended rally.