The Dogecoin (DOGE) price is trading around $0.0694 after an extended downtrend, pushing it toward a critical support zone near $0.07. Despite the recent weakness, the price continues to hold above a key daily support level while consolidating within a narrow range. This raises the possibility of a liquidity-driven reversal. Besides, the on-chain data suggests short liquidations have been stacked within a range. This is believed to be a decisive one.
Can DOGE bulls defend the support and capitalise on the overhead liquidity to stage a bullish recovery?
DOGE Tests a Crucial Support Zone—Can the Bulls Defend?
Dogecoin remains under pressure after breaking below the $0.0916 resistance, trading inside a higher-timeframe bullish order block around $0.069–$0.075. This demand zone has historically attracted buying interest and could determine whether DOGE stages a relief rally or extends its correction. While the broader market structure remains bearish, a successful defense of this order block could shift momentum back in favor of buyers.
- DOGE is currently trading inside a higher-timeframe bullish order block between $0.069 and $0.075. Here, buyers have previously absorbed selling pressure and initiated strong recoveries.
- The immediate resistance is positioned around $0.080, followed by the key market structure level at $0.0916. A breakout above these levels would invalidate the recent bearish structure and expose the next upside targets near $0.10 and $0.125.
- The MACD is approaching a bearish crossover while remaining below the zero line, suggesting the recent recovery is losing momentum. Unless buyers defend the current order block, bearish pressure could continue in the near term.
- A decisive close below the higher-timeframe order block would invalidate the bullish demand zone. This would expose DOGE to the next support around $0.058–$0.060.
Dogecoin Liquidation Map Signals Growing Short Squeeze Potential
Dogecoin’s liquidation map complements the bullish technical setup by revealing a significant imbalance in leveraged positions. According to Coinglass data, nearly $100 million in cumulative short liquidations are concentrated between $0.072 and $0.076. This has created a major liquidity pool above the current price. Hence, if DOGE reclaims the nearby resistance zone, forced liquidations of short positions could amplify buying pressure and accelerate the recovery.
Meanwhile, liquidation liquidity below the current price has diminished considerably. This indicates that much of the downside leverage has already been flushed out during the recent decline toward $0.0694. With fewer long positions left to liquidate beneath the current range, the probability of a correction seems to be weakening.
This shift in liquidity aligns with the potential Swing Failure Pattern (SFP) highlighted on the price chart. A brief move below support to sweep remaining sell-side liquidity, followed by a swift recovery above $0.072. This would trap late short sellers while positioning DOGE to target the larger concentration of liquidity overhead. If buyers successfully reclaim this level, the resulting short squeeze could provide the momentum needed for a move toward the next key resistance levels.
What’s Next for Dogecoin Price?
Dogecoin is approaching a pivotal moment as technical structure and derivatives data begin to align. While the memecoin remains below its immediate resistance, the ongoing consolidation above $0.0694 suggests buyers are attempting to establish a base after the recent decline. A successful reclaim of the $0.0722–$0.0731 resistance zone would confirm renewed bullish momentum and increase the likelihood of a short squeeze, potentially driving DOGE toward $0.0779 and $0.0888.
However, traders should closely monitor the price reaction around the current support zone. A temporary move below the recent swing low followed by a swift recovery would validate the anticipated Swing Failure Pattern (SFP) and reinforce the bullish outlook. Conversely, a sustained breakdown below the protected swing low would invalidate the setup and expose DOGE to further downside before buyers regain control.