Dogecoin (DOGE) showed its potential to break above a bullish consolidation pattern. It suggested the potential uptrend in Dogecoin price but was yet to be confirmed as of press time.
Dogecoin Price Analysis
A bull flag pattern developed for the DOGE/USD pair on the 1-hour time frame chart. The intensive upward movement, which extended from $0.1520 to $0.1850, established the “flagpole” during its development stage following a major bullish pressure.
DOGE price displayed a consolidation phase within two downward-sloping trend lines. Thus, it formed the flag pattern from $0.1680 to $0.1840. This price movement typically suggested a trading pause before further movement as the prevailing uptrend had a chance to continue.
Dogecoin price was testing its flag’s upper boundary between $0.1810 and $0.1840 at the point of observation. Breakout success above the resistance could validate the bull flag pattern to trigger a potential price increase.
This could direct DOGE toward reaching $0.22 by measuring the distance from the breakout point through the flagpole length.
A successful breach of resistance would create highly positive momentum, which could enhance investor participation in the market. A downward movement below $0.1680 would result in the invalidation of a bullish outlook for DOGE.
If the price declines past $0.1600 and $0.1520, where the previous strong price rally started, then traders should watch for continued weakness in Dogecoin’s value.
The market’s future movement depended on close trader monitoring of prices between $0.1810 and $0.1840. That’s because bullish verification, along with a $0.1680 dip, indicated bearish risks and possible trend change.
Dogecoin Short Liquidations
Traders monitoring DOGE price would find themselves on edge due to a potential price shift. A rise in price above $0.19 would cause millions of dollars in short position liquidation threats. It could exceed $55 million.
Analyzing heatmaps revealed that short sellers had strongly invested their trading positions near $0.1908. That would likely cause significant market movements.
DOGE showed a prolonged downward price trend moving from $0.44 to the vicinity of $0.15 throughout the recent three months. Traders placed most of their aggressive short positions within the range between $0.19 and $0.25. It created various liquidity pockets.
A rapid chain reaction of speculative liquidations would start if DOGE breaks the critical price barrier at $0.19 because short sellers would need to buy back their losing positions. Market data showed that $55 million worth of short positions could experience immediate liquidation.
Underestimating DOGE’s market strength would result in quick price acceleration. It would drive the rate toward resistance points at $0.22 and $0.25. The continuing bullish market trends would result in both existing short positions getting wiped out by the breakout.
Dogecoin price approached a tipping point that maintained critical attention for breaking through the $0.19 resistance level.
Crowd vs Smart Money Sentiment
The sentiment within the DOGE community indicated enthusiastic optimism as the sentiment gauge value reached 0.77. The overall positive outlook about Dogecoin could have originated from social media hype and increased interest in cryptocurrency.
Detailed traders and investors expressed negative opinions about DOGE price, according to smart money sentiment readings of -0.32.
The superior market analysis, coupled with greater capital, tended to maintain a more cautious outlook regarding the future of Dogecoin price performance.
The discrepancy between mainstream audience opinion and expert analysis created a potential discrepancy for major price movements during periods of cryptocurrency market fluctuations.
The post Dogecoin Price Eyes $0.22 As $55M DOGE Shorts Risk Liquidation appeared first on The Coin Republic.
