Dogecoin (DOGE) is trading close to $0.20 and is forming a major short liquidation cluster, as the charts indicate a potential trend.

Price Action and Market Performance

As of the time of writing, Dogecoin (DOGE) is trading close to $0.20, having dropped over 3% in the last 24 hours. Over the past week, the token has fallen by 10%, with a daily trading volume of $1.4 billion. Dogecoin has pulled back after reaching a volatile high of $0.28.

CoinGlass data shows that the trading volume in the last 24 hours was $5.19 billion, an increase of 54%, with open contracts at $3.09 billion. Options trading volume increased by 30% to $17 million, with open contracts at $120,000, a growth of 13%. The open contract volume for Dogecoin futures dropped from 19.7 billion DOGE to 15.36 billion DOGE during the decline, reflecting a reduction in leveraged positions.

Liquidation Chart and Key Price Levels

TheKingfisher reports that the largest cluster of short liquidations is near $0.208. A price drop into this area could trigger a short squeeze. Long liquidations remain dispersed, indicating less downward pressure.

At the same time, the liquidation chart uses full leverage data, indicating that these levels may be reached in weeks rather than days. Tracking these clusters can show where forced liquidations may occur and where prices may fluctuate.

Technical Patterns and Potential Reversal Signals

Trader Tardigrade points out that Dogecoin is showing an ascending expanding wedge pattern on the weekly chart. The past movement of this pattern fell from $0.22 to $0.48. The next target is expected to be $1.40. The lower line of the wedge acts as a support level, while the upper line of the wedge remains a resistance level.

On the hourly chart, an inverted head and shoulders pattern is forming. The neckline is around $0.210, which constitutes a short-term resistance level. If the volume breaks this level, the price of Dogecoin may drop to $0.214-$0.218.

Traders see the $0.208 level as a recent price target, and a short squeeze may drive the next move.