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Dogecoin kicked off the new year with an impressive 29% rally against local demand levels, captivating investors and signaling its resilience in the cryptocurrency 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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Lead analyst Bluntz recently shared an in-depth analysis, highlighting that Dogecoin appears to be in a period of strategic accumulation. According to Bluntz, this phase is laying the groundwork for an aggressive rally 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 will fight 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 zone could result in a short-term consolidation, delaying the expected rally.
Dogecoin plans a rally
Dogecoin has shown strong bullish price action since early November, defying market volatility and capturing the attention of investors. Even with its recent correction, the price has managed to recover, showing growth that underlines its potential for further upside.
Bluntz recently shared a technical analysis on X, highlighting the accumulation phase in the DOGE/BTC relationship. According to Bluntz, the report 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 rise during this bull run, reflecting the analyst’s optimistic view on the meme coin leader.
While 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 an additional layer of uncertainty, with rising interest rates, inflation and global economic pressures influencing investor sentiment. 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 represent an opportunity to enter the market before a potential breakout. However, risk management and a cautious approach are key, especially given the unpredictable nature of both the cryptocurrency market and the global economy. If Dogecoin can break above key resistance levels, it could validate Bluntz’s bull thesis and solidify its status as a top performer in this cycle.
Price consolidation
Dogecoin is currently trading at $0.38, after encountering resistance at $0.40. This level temporarily halted DOGE’s bullish momentum, placing the price in a consolidation phase. Such periods of sideways trading are not uncommon and could last 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 a critical resistance level for DOGE. A clear break above this level would mean renewed bullish momentum, potentially pushing Dogecoin to multi-year highs or even new all-time highs. Achieving this goal would likely attract new attention from both retail and institutional investors, further strengthening its bullish trajectory.
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However, the path forward is not without challenges. Market sentiment and broader cryptocurrency trends will play a significant role in determining whether Dogecoin is able to muster the strength 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, TradingView chart