Dogecoin (DOGE) continues to ride a volatile wave in the crypto market. Despite a slight 2.75% drop in the last 24 hours, the coin shows promising signs of a bullish reversal. With Bitcoin’s value holding steady near the $93,000 support level, Dogecoin seems to be holding its ground above the crucial $0.30 mark, maintaining a market cap of $46.16 billion.

Although the market sentiment is generally bearish due to fluctuations in Bitcoin’s price, some key technical indicators suggest that Dogecoin might be preparing for a breakout rally as we enter 2025. A whale has shown renewed confidence in the cryptocurrency, and the charts reveal potential for Dogecoin to surge if it manages to break its current resistance levels.

Dogecoin’s Current Price Action: Support at $0.30

Looking at the 4-hour chart, Dogecoin is consolidating in a tight range above the $0.30 support. While the broader market sentiment remains cautious, DOGE has consistently held this psychological level, indicating it is a significant price point for the coin. This strong support coincides with the 23.6% Fibonacci retracement level, which adds further confidence in the level’s ability to hold.

The pattern currently forming on Dogecoin’s price chart is a descending triangle. This formation suggests that while the price is being compressed, there is increasing pressure on the support zone. However, for the bulls to gain control, Dogecoin needs to break through the longstanding resistance trendline that has kept its price in check.

Bullish Signal: Morning Star Pattern

On the technical side, Dogecoin has formed a classic Morning Star reversal pattern, signaling a potential shift in momentum. This pattern typically appears after a downtrend and indicates a bullish reversal, especially when confirmed with a rise in trading volume. In Dogecoin’s case, the pattern has completed, and the price is now challenging the 20-EMA (Exponential Moving Average) line, which could serve as the first resistance in its path to higher price levels.

As of the latest data, Dogecoin’s price is at $0.3171, reflecting a 1.73% increase in the last 4 hours. The price movement appears to be gaining upward momentum, and if the bullish momentum continues, the next target for DOGE would be the overhead resistance trendline. Breaking this level would clear the way for a potential rally, pushing the price toward the next resistance area at $0.35.

RSI Divergence and Bullish Sentiment

An additional bullish signal comes from the 4-hour Relative Strength Index (RSI), which shows a divergence from the price action. The RSI is moving upward while the price of DOGE is consolidating, indicating increasing buying pressure and a potential reversal. A bullish RSI divergence typically signals that the market is gaining strength, even if the price action has not yet reflected that shift.

This RSI divergence is helping to build confidence among bullish traders, who may be looking at this as an opportunity to enter the market ahead of the potential breakout.

Potential Price Targets for Dogecoin

If Dogecoin manages to break above the current resistance levels, the next target for the coin would likely be the 50% Fibonacci retracement level, which is positioned at $0.3521. This would represent a solid gain from the current price.

However, there are risks involved. If the bearish trend continues, especially with Bitcoin’s price approaching the $90,000 support level, Dogecoin might not hold the $0.30 support. In such a case, the price could break down, testing the $0.265 support zone before any potential recovery.

Final Thoughts

Dogecoin’s technical setup is showing some positive signs, particularly with the formation of a Morning Star pattern and bullish RSI divergence. If DOGE manages to stay above $0.30 and break through the resistance trendline, it could trigger a rally toward the $0.35 level. However, traders should be mindful of the broader market conditions and Bitcoin’s influence on the crypto space, as any significant downturn could put further downward pressure on Dogecoin’s price.

As we move into 2025, Dogecoin’s performance will largely depend on its ability to break key resistance levels and sustain upward momentum. Whether it can break out of its current consolidation and establish a solid bullish trend will be a key factor in determining its price direction for the new year.