Dogecoin (DOGE) has been under bearish pressure, dropping 20% in seven days. At press time, DOGE traded at $0.264 with a market cap of $39 billion. However, volatility has declined, forcing the largest memecoin into consolidation.
Liquidation Clusters Could Drive DOGE Higher
According to Coinglass data, a significant liquidation cluster is forming around $0.272. If DOGE reaches this level, short sellers risk liquidation, which could trigger a buying spree and fuel a rally.
Earlier this week, an influx of long liquidations cleared clusters below the current price, reducing downward pressure. Meanwhile, Funding Rates have turned positive, indicating increased demand for long positions, which supports a bullish outlook.
Can DOGE Break Out of Consolidation?
DOGE’s hourly chart shows a consolidation pattern. It is attempting to break above the midline of its trading channel, but low volumes limit upside momentum.
For a breakout to materialize, DOGE must surpass resistance at $0.272—where short liquidations could accelerate the upward movement. The Relative Strength Index (RSI) has risen to 52, signaling that buyers are gradually returning. Additionally, the RSI is trending above its signal line, reinforcing short-term bullish momentum.
Despite the rising RSI, the constriction of Bollinger Bands suggests low volatility. DOGE may remain in consolidation unless buying demand increases significantly.
Market Sentiment: 77% of Traders Are Long on DOGE
Coinglass data reveals that 77% of Binance traders hold long positions, with only 22% shorting DOGE. This indicates strong bullish sentiment. If buyers step in, DOGE could see an explosive breakout above $0.272.
As the market eyes key levels, traders should watch DOGE’s price action closely. A breakout could push Dogecoin into a new bullish phase, making $0.272 the level to beat for further upside gains.
