Dogecoin (DOGE) is showing strong signs of a potential major price rally, with technical indicators and on-chain metrics aligning to support a bullish continuation. Following an 18% gain this week and currently trading above $0.21, DOGE is forming a textbook double bottom pattern on its daily chart, a historically reliable reversal formation. This bullish structure emerges after DOGE decisively broke out of a long-standing descending channel, signalling a significant shift in momentum.
Technical Signals Point to Upward Movement
The recent breakout from its long-term downtrend has led DOGE into a consolidation phase between $0.19 and $0.21, which analysts interpret as a healthy retest and hold after a breakout. An immediate break above $0.21 is expected to pave the way to $0.25, a critical level that would complete the double bottom pattern. Successfully clearing $0.25 could open a path towards $0.48, a price point last seen in December 2024.
Adding further weight to the bullish case, crypto analyst Trader Tardigrade has noted that DOGE’s larger structure on the weekly chart shows it trading within an ascending broadening wedge. This technical formation is renowned for its parabolic breakout potential, suggesting that DOGE is gearing up to test and potentially breach its upper boundary. Based on historical precedents and structural analysis, such a move could lay the foundation for a 300% rally once the $0.25 level is reclaimed, with the psychological $1 mark emerging as a realistic long-term target if DOGE can clear the $0.47 resistance.
On-Chain Data Supports Bullish Bias
From an on-chain perspective, Dogecoin’s metrics strongly support this bullish setup. Futures Open Interest (OI) for DOGE has seen a massive jump in July, surging by 67% from $1.70 billion to $2.85 billion. This indicates renewed speculative activity in the market. Despite this increase in OI, funding rates remain neutral, which is a positive sign, suggesting that leveraged long positions have not yet overheated the market, reducing the risk of a sharp correction.
In parallel, the spot cumulative volume delta (CVD) continues its slow rise, revealing persistent net buying pressure in the spot market. This indicates genuine demand underpinning the recent price action, rather than just speculative fervour. Further reinforcing the bullish outlook is the Long-Term Holder Net Unrealised Profit/Loss (LTH-NUPL) metric, which has now entered the “Optimism-Anxiety” zone.
This psychological zone implies that long-term DOGE holders are sitting on moderate profits, and their sentiment is shifting from uncertainty towards cautious confidence. Historically, every major DOGE breakout, including those in 2021 and 2024, began once the LTH-NUPL moved into this zone, suggesting that long-term holders are reducing selling pressure and allowing short- to mid-term capital inflows to drive price action.
