- Optimism surrounding US-China trade talks and funding for DogeOS are creating bullish conditions for Dogecoin.
- Technical indicators and rising open interest suggest a potential breakout towards $0.20.
Dogecoin (DOGE) has shown renewed strength, climbing back to the $0.17 level following positive news regarding potential trade negotiations between the U.S. and China. This development, coupled with other bullish factors, is fueling speculation that Dogecoin could soon exceed $0.20.
Technical Analysis and Market Sentiment
Dogecoin is currently exhibiting a falling wedge pattern on the 4-hour chart, a formation that often precedes a breakout. The price has been consolidating within this pattern over the past two weeks, with swing lows since April 2022 forming the lower boundary and peaks from late April and early May creating the resistance line.
Currently, Dogecoin is testing the 200 EMA line, coinciding with the 61.80% Fibonacci level at approximately $0.1729. Despite some initial resistance, the overall trend within the wedge pattern suggests a likely retest of the upper resistance. Moreover, a death cross event, where the 50 EMA crosses below the 200 EMA, now seems less likely due to the recent recovery.
Adding to the positive outlook, the MACD and signal lines have shown a bullish crossover, indicating a potential trend reversal. The projected breakout from the falling wedge pattern targets the $0.20 psychological level. If the bullish momentum continues, Fibonacci levels suggest further potential targets at $0.2299 and $0.2673.
Optimism surrounding the potential for renegotiated trade deals between the US and China has boosted market sentiment. U.S. and Chinese trade officials are scheduled to meet in Switzerland later this week, as Donald Trump hints at a “major announcement.” The talks are intended to revive formal economic dialogue following months of escalating tariff tensions.
Both countries have issued official statements confirming the planned meeting. This was also reported by Gokhshtein, a media and news company.
The anticipation of the FOMC meeting on May 7, where it is widely expected that federal rates will remain unchanged at 4.25% to 4.5%, could lead to short-term volatility. However, the market is expected to stabilise, allowing Dogecoin to regain its upward trajectory.
DogeOS Funding and Derivatives Market Activity
The recent funding of $6.9 million for DogeOS from Polychain has further boosted sentiment around Dogecoin. Historically, Dogecoin’s price has seen short-term spikes aligned with such surges in sentiment, suggesting this funding could contribute to reaching the $0.20 mark.
Much Wow! Very Funded! DogeOS just raised $6.9M (nice) to turn Dogecoin into the internet’s favourite app layer. Big thanks to @polychain for leading the round, and to all our amazing supporters backing the mission. We’re just getting started!
they stated on their official X account.
In the derivatives market, Dogecoin’s open interest has increased by 1.45% to $1.69 billion, signalling rising trader interest. The open interest as a percentage has increased to 0.0071%, reflecting growing bullish sentiment. This dominance by bulls in the derivatives market increases the risk of short liquidations for Dogecoin.
Exchange data indicates that a significant short liquidation event of around $10.96 million could occur if Dogecoin reaches $0.1755. A further rise to $0.1761 could trigger liquidations of up to $13.65 million. These liquidations could potentially drive the price of Dogecoin higher. DOGE is currently trading at $0.1733, up 3.48% in the last 24 hours.
The post Dogecoin Set to Break $0.20 Barrier This Week – Here’s What’s Driving the Surge appeared first on ETHNews.
