Key Points:
Dogecoin surged 7.5% in the last 24 hours, climbing back to the $0.254 range.
Despite the short-term rally, technical indicators and market behavior suggest potential bearish pressure ahead.
Resistance at $0.36 remains a long-standing psychological and technical barrier.
Spot selling pressure has intensified, with $39 million in outflows recorded recently.
A critical resistance level at $0.2478 is being tested for the fourth time, increasing the likelihood of a reversal.
Liquidation patterns suggest a potential tug-of-war between bulls and bears in the near term.
The Rally That Might Not Last
Dogecoin has experienced a notable upward movement over the past day, climbing 7.5% and pushing its price back into the $0.254 range. For many investors, this sudden surge might suggest a shift in market sentiment, especially after a period of consolidation. However, beneath the surface of this bullish momentum lies a growing concern among analysts and traders alike. While the price has rebounded, several on-chain and technical indicators are flashing caution signs, hinting that this rally may not be sustainable in the medium to long term.
The market’s structure suggests that the current move upward may be more of a countertrend bounce rather than the start of a new bullish cycle. Historical patterns and resistance levels are aligning in a way that could cap further gains. In fact, the broader sentiment seems to be one of skepticism rather than optimism, especially when considering the growing imbalance between buying and selling pressure in the spot market.
Long-Term Resistance Still Looms
One of the most critical technical indicators currently in focus is the UTXO Realized Price Distribution (URPD) model from Glassnode. This metric helps identify key price zones where long-term holders have previously entered the market. For Dogecoin, the $0.36 level stands out as a significant ceiling. Although DOGE recently managed to break and hold above the $0.20 psychological level, the road beyond $0.254 is far from smooth.
Historically, every time DOGE has approached $0.36, it has faced strong resistance, leading to sharp corrections. The daily chart confirms this trend. The price has touched this level twice before and each time was met with aggressive selling pressure. Even a brief move above $0.36 has not been enough to establish a new trend, as the market has consistently rejected higher prices. This suggests that unless Dogecoin can sustain a close above $0.36 with strong volume and on-chain support, the likelihood of a pullback remains high.
Immediate Resistance Faces Fourth Test
Zooming into the short-term chart, another key level is drawing attention: $0.2478. This level has acted as a pivotal resistance in the past, and DOGE is now testing it for the fourth time. Each prior attempt has resulted in a downward move, and history suggests that the fourth test may not be any different. If the price fails to hold above this level, a deeper correction could follow, potentially dragging DOGE back below $0.24.
However, the narrative could change dramatically if the bulls manage to push through this zone and maintain control. A strong close above $0.2478 could signal renewed confidence and possibly open the door for a retest of the $0.30 level. The next few days will be crucial in determining whether this current rally is just a temporary bounce or the start of something more substantial.
Sellers Gain Momentum in Spot Market
While the price action has been somewhat encouraging, the underlying market dynamics paint a different picture. Over the last 24 hours, DOGE saw a net outflow of $39 million in spot trading, marking one of the largest sell-offs in recent weeks. This selling pressure indicates that many investors are taking profits at current levels, which could lead to a vacuum in buying support if the trend continues.
This behavior is reminiscent of early January, when a similar wave of selling triggered a sharp decline in price. The fact that traders are once again offloading their holdings suggests a lack of conviction in the current rally. Unless fresh buying interest emerges to absorb this selling pressure, the market could easily tip back into bearish territory.
Liquidation Heatmap: Bulls vs. Bears
Despite the bearish signals, there are still pockets of opportunity forming on the chart. The liquidation heatmap reveals two distinct clusters of liquidity—one above the current price and one below. The upper cluster, between $0.259 and $0.260, contains $11.21 million in sell orders, while the lower cluster, between $0.250 and $0.249, holds $11.61 million in buy orders.
This setup creates a fascinating dynamic. If the price moves upward and triggers the upper sell orders first, it could lead to a short squeeze, pulling the price down toward the lower cluster, which may then act as a demand zone. Conversely, if the price drops and hits the buy orders first, it could spark a bounce back toward the upper level, now functioning as resistance.
This tug-of-war between bulls and bears suggests that the next directional move could be volatile. However, without a strong support base below the current price, a prolonged downtrend remains a real possibility.
Conclusion: Volatility Ahead, Conviction in Question
Dogecoin’s recent 7.5% gain has brought renewed attention to the memecoin, but the broader technical and on-chain landscape remains clouded with uncertainty. While the short-term rally is impressive, it’s occurring in an environment where selling pressure is rising, key resistance levels are looming, and liquidity is precariously balanced.
The $0.36 level continues to act as a psychological and technical barrier, and until DOGE can convincingly break and hold above it, any further gains may be short-lived. Meanwhile, the immediate test at $0.2478 could determine whether this rally has legs or if it’s merely another false breakout in a consolidating market.
Investors should remain cautious and closely monitor the unfolding dynamics. The next few days will be pivotal in determining whether Dogecoin can overcome its long-standing hurdles or succumb to the growing bearish forces at play.
