Dogecoin (DOGE) could be gearing up for a notable breakout as bullish momentum builds. With exchange outflows rising and trader sentiment shifting to favor long positions, DOGE may be on the verge of reversing its downtrend. Technical indicators now suggest a 24% rally could be in play if certain resistance levels are broken.

Bullish Sentiment Builds Amid Exchange Outflows

Recent on-chain data reveals that traders are increasingly moving DOGE out of exchanges, a trend that is often interpreted as accumulation. According to analytics platform Coinglass, over $3.75 million worth of DOGE has flowed out of exchanges in the past 24 hours.

This trend indicates growing investor confidence, as coins leaving exchanges are typically transferred to private wallets for long-term holding. Reduced exchange supply can tighten market conditions and create upward pressure on prices — a factor that may support a rally in the near term.

Traders Favor Long Positions

Another positive indicator comes from the DOGE Long/Short Ratio, which currently stands at 1.116. This means that more traders are betting on price increases than declines — a ratio above 1 usually reflects a bullish market outlook.

The long bias suggests that traders expect DOGE to move higher, a sentiment reinforced by the current uptick in trading volume. Over the last 24 hours, DOGE trading activity increased by 15%, highlighting renewed interest from market participants.

Technical Breakout Signals Strength

Technically, Dogecoin has just broken out above a descending trendline that has acted as firm resistance since January 2025. For months, DOGE faced repeated rejections at this trendline, each time triggering sell-offs. This week’s breakout is a potential signal that bearish pressure may be weakening.

At the time of writing, DOGE is trading at approximately $0.1643 — a 1.5% gain over the past 24 hours. If the price manages to close a daily candle above the $0.165 mark, analysts believe a 24% rally could follow, potentially pushing DOGE to the $0.207 level in the short term.

However, DOGE remains below the 200-day Exponential Moving Average (EMA), which is often viewed as a key indicator of overall trend direction. Staying below this level suggests that while the short-term momentum may be bullish, the longer-term trend is still under the control of the bears.

RSI Suggests More Room to Run

Dogecoin’s Relative Strength Index (RSI) currently hovers around 50 — a neutral reading that indicates the asset is neither overbought nor oversold. This positioning gives DOGE room to climb higher before encountering resistance from overbought conditions.

A rising RSI in combination with increasing volume and bullish sentiment could further support a sustained upward move. However, traders should watch for confirmation through a clean break above the $0.165 resistance with strong volume.

What to Watch Next

For traders and investors watching DOGE closely, the $0.165 level remains a critical line in the sand. A confirmed breakout above this threshold could open the door to a run toward $0.207 — a price target that would mark a 24% rally from current levels.

However, failure to hold above the breakout level or rejection at the 200-day EMA could indicate a false breakout and renew downward pressure.

In summary, Dogecoin is showing several signs of bullish reversal — strong accumulation, increasing volume, and a favorable trader bias. But the rally’s continuation depends on whether bulls can push past the resistance zone with conviction. Keep an eye on daily closes and RSI behavior for cues on the next big move.