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Dogecoin has started the new year with an impressive rally of 29% from local demand levels, which has attracted investors and indicated its resilience in the crypto market. The meme coin leader is now testing critical resistance around the $0.40 mark, a level that could determine its next move.
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Top analyst Bluntz recently shared an insightful analysis, highlighting that Dogecoin appears to be in a strategic accumulation period. According to Bluntz, this phase is laying the foundation for an aggressive surge later in the cycle, potentially setting DOGE up for significant gains. Such accumulation periods are often the harbinger of explosive upward movements, especially for assets with strong community support like Dogecoin.
The coming days will be crucial for DOGE as it struggles to break the $0.40 resistance. A successful breakout could ignite a bullish rally, which would solidify Dogecoin’s position as a market favorite. However, failure to clear this area could result in short-term consolidation, delaying the anticipated bounce.
Dogecoin is preparing a rally
Dogecoin has demonstrated a strong bullish momentum since the beginning of November, defying market volatility and attracting the attention of investors. Even with the recent correction, the price has recovered, showing an uptrend that underlines the potential for further upside.
Bluntz recently Shared a technical analysis on XThe accumulation phase in the DOGE/BTC ratio is highlighted. According to Bluntz, the ratio is “still accumulating,” suggesting that Dogecoin is preparing for a significant rally this cycle. Bluntz confidently stated that there is no chance that DOGE will not surge during this rally, which reflects the analyst’s optimistic outlook on the meme coin leader.
While the trajectory of Dogecoin looks promising, it is important to recognize the associated risks. Volatility continues to be a hallmark of cryptocurrency markets, and Dogecoin is no exception. The macroeconomic outlook adds another layer of uncertainty with rising interest rates, inflation and global economic pressures impacting investor sentiment. These factors could contribute to a period of sharp price fluctuations for DOGE.
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For long-term investors, Dogecoin’s ongoing accumulation phase could provide an opportunity to enter the market ahead of a potential breakout. However, risk management and a cautious approach are important, especially given the unpredictable nature of both the crypto market and the global economy. If Dogecoin manages to clear key resistance levels, it could validate Bluntz’s bullish thesis and solidify its position as a top performer this cycle.
price in consolidation
Dogecoin is currently trading at $0.38 after facing resistance at the $0.40 mark. This level has temporarily halted DOGE’s upward momentum, putting the price in a consolidation phase. Such periods of sideways trading are not unusual and can last for several days or even weeks as the market gathers strength for the next move.
Despite the pause, optimism remains high among investors and analysts. The $0.43 mark is emerging as an important resistance level for DOGE. A clear breakout above this level would signal renewed bullish momentum, potentially taking Dogecoin to multi-year highs or even new all-time highs. Achieving this will attract renewed attention from both retail and institutional investors, further boosting its upward trajectory.
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However, the path ahead is not without challenges. Market sentiment and broader crypto trends will play a key role in determining whether Dogecoin can muster the strength to push higher. If the consolidation phase involves increased trading volume and strong buying support, a breakout scenario becomes more likely.
Image displayed from Dell-E, chart from TradingView
