Dogecoin traders, look out for the $0.20 support level – Here’s why!

Key Takeaways

Dogecoin held its ascending triangle near $0.20 while its volumes spiked to $13.49 billion. Circulating market cap hit $31.7 billion, recalling July’s $40 billion peak. Is DOGE ready to break or fake again?

Dogecoin [DOGE] has spent the last two months consolidating within an ascending triangle – A pattern that traders and investors alike often watch for signs of continuation.

In fact, at the time of writing, the structure seemed to be close to resolution, with the price momentum building after another test of the $0.20 support zone.

Source: TradingView

Dogecoin’s trading activity is picking up

One shift standing out was a surge in trading volume. Instead of fading as consolidation dragged on, the activity started rising.

That usually is a sign that traders may be positioning themselves for the next move. If momentum holds, DOGE could be setting the stage for a sharper breakout attempt.

In fact, when a similar surge happened in late 2024, DOGE’s price recorded an explosive bullish run on the charts.

Source: Token Terminal

Rcently, Token Terminal data highlighted weekly trading volumes of $13.49 billion during the week of 25 August – A sharp uptick that reinforced the view that traders might be building positions ahead of a decisive move.

Market cap signals growing interest

Finally, Dogecoin’s circulating market cap rose to about $31.7 billion on 01 September, as per Token Terminal. This hinted at renewed attention from investors.

On the contrary, it also introduced some degree of volatility, especially if the price broke out of its narrowing range. A surge in circulating market cap typically alludes to greater retail activity across the board.

Source: Token Terminal

Is a breakout or a trap ahead for Dogecoin?

The key question is whether DOGE can sustain this setup and go for a genuine rally. A decisive break above triangle resistance would likely trigger technical buying. And yet, false breakouts are common in such patterns. With heavy retail participation in DOGE, sentiment could flip quickly.

Right now, traders are looking at whether demand at press time levels will hold. If it does and if volumes offer confirmation, the case for a bullish resolution will strengthen. If not, DOGE may slip towards its lower supports.

Either way, consolidation seemed to be near its end. And, the next move is likely to set the tone for the distribution phase.