Dogecoin eyes breakout: THIS will decide DOGE’s next big move

Key Takeaways

Dogecoin’s TD Sequential buy signal hints at a recovery rally. Meanwhile, Binance traders hold 75% long positions, but liquidation clusters at $0.215–$0.225 could trigger volatility.

Dogecoin [DOGE] recently caught attention after the TD Sequential indicator flashed a buy signal on its 4-hour chart, hinting at a possible short-term rebound. 

The memecoin has been sliding for weeks, but at the time of writing it traded at $0.218, holding near a key zone of support. 

Such buy signals often precede local reversals, especially when sentiment and positioning align. 

Therefore, traders are closely watching if this signal can trigger a bounce that stabilizes prices and sets the stage for a stronger recovery.

Can DOGE drive toward $0.42?

The daily chart highlighted a developing cup-and-handle structure that could fuel Dogecoin’s next breakout. This pattern suggested a bullish continuation, if price clears neckline resistance. 

The crucial resistance levels were at $0.244 and $0.277, which must be conquered for momentum to accelerate. If confirmed, DOGE could extend its rally toward $0.42, the projected target from the structure. 

However, failure to break these barriers could trap bulls. Therefore, the next few sessions are critical in determining if this bullish setup can sustain its upward potential.

Source: TradingView

Betting heavy on a DOGE breakout?

Market sentiment on Binance derivatives currently leans strongly bullish, with long accounts holding 75% dominance compared to just 25% short accounts.

This skew suggests traders anticipate a rebound, aligning with technical patterns pointing higher. 

However, such heavy long exposure can increase the risk of cascading liquidations if price retraces. 

Still, the strong positioning provides liquidity support that could aid in pushing Dogecoin above immediate resistance. 

Therefore, the combination of bullish chart structures and long dominance makes this an interesting setup for speculators eyeing upside continuation.

Source: CoinGlass

Will liquidation clusters fuel volatility?

Data from the liquidation heatmap shows significant pressure zones, with heavy liquidation clusters concentrated near $0.215 for shorts and $0.225 for longs. 

These pockets represent levels where sharp moves can force traders out of positions, amplifying volatility. 

If DOGE dips below $0.215, long liquidations may accelerate selling, while a surge beyond $0.225 could trigger short squeezes. 

Therefore, traders must remain cautious as price hovers between these levels. 

A decisive move beyond either threshold could define the next short-term trend, shaping whether Dogecoin consolidates or breaks higher.

Source: CoinGlass

Summary 

Dogecoin is positioned for a bullish recovery as the TD Sequential buy signal, cup-and-handle structure, and dominant long positions all point toward further upside. 

Despite short-term volatility around $0.215–$0.225, the alignment of technical patterns and sentiment makes a breakout above $0.244 and $0.277 increasingly likely. 

Once these levels are cleared, DOGE has a strong chance of extending toward $0.42. Therefore, the outlook favors buyers, with current market conditions supporting a sustained recovery rally rather than further decline.