Dogecoin (DOGE) price is down 1.94% today and trades at $0.2316, signaling a struggle to overcome the $0.25 resistance level. This development is in line with Bitcoin’s retracement from the $104k ceiling. Despite the intraday pullback, Dogecoin Open Interest (OI) has crossed $3 billion, reflecting the perpetual traders’ interest. Will this spike in investor interest, coupled with a bullish pattern, help Dogecoin price overcome $0.25 and catalyze a 50% rally to $0.368?
Dogecoin in a Bullish Pennant Targets $0.36
Dogecoin price action over the past two weeks reveals a bullish pennant. The 36% surge in the first week of May created the flag pole, while the consolidation thereafter led to the pennant formation. This setup forecasts a 53% rally to $0.368, obtained by adding the flag pole’s height to the breakout point.
Over the past three days, Dogecoin’s price has produced lower highs, but is close to overcoming the pennant’s upper trendline. Assuming DOGE produces a decisive daily candlestick close at $0.240, it would confirm a breakout and catalyze a massive double-digit uptrend to $0.368.
Supporting this bullish breakout is the Relative Strength Index (RSI) that has bounced off the 50-level, signaling that despite the recent correction, DOGE bulls are still in control.
Dogecoin price chartThis bullish Dogecoin price prediction will face headwinds if Dogecoin price fails to surpass the pennant’s overhead trendline. A breakdown of the $0.220 support level will invalidate the optimistic outlook and catalyze a correction to $0.180 after an 18% correction.
$280 Million Surge in DOGE Open Interest Risks $62 Millions of Short Positions Wipeout
According to CoinGlass data, the open interest for DOGE has hit $3.03 billion, surging by $280 million from a low of $2.75 billion. This uptick clearly underlines increased investor interest in the original meme coin. As Dogecoin’s price consolidates, the surge in open interest reflects the increased optimism.
Additionally, the funding rate at 0.0105% shows strong underlying bullish intent, i.e., long positions are pay fees to short positions to maintain the peg between spot and perpetual prices. An added incentive for a push higher is visible when looking at Coinglass’ Liquidation Map. A Dogecoin price rally above $0.25 could lead to $62.87 million in short liquidations. Such a massive wipeout of sellers’ positions could boost the breakout rally.
In conclusion, Dogecoin remains in a bullish consolidation, ready for a 50% breakout rally. Rising open interest and potential liquidation of $67 million short positions add credence to this optimistic outlook that forecasts a $0.368 target.
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