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Dogecoin kicked off the new year with an impressive 29% rise in local demand levels, captivating investors and signaling its resilience in the crypto market. The leading meme coin is currently testing critical resistance around the $0.40 mark, a level that could determine its next move.
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Leading analyst Bluntz recently shared an insightful analysis, highlighting that Dogecoin appears to be in a period of strategic accumulation. According to Bluntz, this phase lays the groundwork for an aggressive push later in the cycle, potentially positioning DOGE for significant gains. Such periods of accumulation are often precursors to explosive upward moves, especially for assets with strong community support like Dogecoin.
The next few days will be crucial for DOGE as it struggles to break above the $0.40 resistance level. A successful breakout could trigger a bullish rally, strengthening Dogecoin’s position as a market favorite. However, failure to clear this area could lead to consolidation in the short term, delaying the expected surge.
Dogecoin imagines a rally
Dogecoin has displayed a strong upward price trend since early November, defying market volatility and attracting the attention of investors. Even after its recent correction, the price has managed to recover, showing growth that highlights its further upside potential.
Bluntz recently shared technical analysis on X, highlighting the accumulation phase in the DOGE/BTC ratio. According to Bluntz, the ratio “continues to accumulate,” suggesting that Dogecoin is preparing for a significant rally in this cycle. Bluntz confidently stated that there is “zero chance” that DOGE will not rise during this bull run, reflecting the analyst’s bullish outlook on the coin leader.
Although Dogecoin’s trajectory appears promising, it is essential to recognize the associated risks. Volatility remains a hallmark of cryptocurrency markets, and Dogecoin is no exception. The broader economic landscape adds another layer of uncertainty, with rising interest rates, inflation and global economic pressures influencing investor confidence. These factors could contribute to periods of sharp price fluctuations for DOGE.
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For long-term investors, Dogecoin’s ongoing accumulation phase may present an opportunity to enter the market before a possible breakout. However, risk management and a prudent approach are essential, especially given the unpredictable nature of the cryptocurrency market and the global economy. If Dogecoin manages to break through key resistance levels, it could validate Bluntz’s bullish thesis and solidify its status as the top performer in this cycle.
Price in consolidation
Dogecoin is currently trading at $0.38 after encountering resistance at $0.40. This level temporarily halted DOGE’s upward momentum, placing the price in a consolidation phase. Such periods of sideways trading are not uncommon and could last for several days or even weeks as the market strengthens in preparation for the next move.
Despite this pause, optimism remains high among investors and analysts. The $0.43 mark appears to be a critical resistance level for DOGE. A clean break above this level would mean renewed bullish momentum, potentially propelling Dogecoin to multi-year highs or even new all-time highs. Achieving this would likely attract new attention from retail and institutional investors, strengthening its upward trajectory.
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However, the path forward is not without challenges. Market sentiment and broader crypto trends will play an important role in determining whether Dogecoin can muster the strength needed to push higher. If the consolidation phase is accompanied by an increase in trading volume and strong buying support, the breakout scenario becomes increasingly likely.
Featured image of Dall-E, chart by TradingView
