Dogecoin's 18% Gain May Repeat as Buying Volume Surges

Dogecoin has recently hit a key support level on its weekly chart, suggesting that a significant price movement may be imminent. The cryptocurrency's volume, OI-Weighted sentiment, and substantial purchases of DOGE have positioned it favorably for a bullish trend.

Dogecoin's recent decline over the past 24 hours could potentially benefit the asset, allowing it to continue its upward trajectory similar to the previous week's trend, where it gained 18%. This rally would require coordinated efforts from both spot and derivative market traders to push the asset higher.

Dogecoin has recently traded into a crucial level on its chart, known as the ascending support line, which has historically acted as a major price catalyst. This level previously prompted the market high of $0.48. If Dogecoin surpasses the $0.22 level, it could advance further, with the $0.38 level representing a significant target due to a major batch of liquidity clusters in the market. Maintaining upward momentum is essential for DOGE to achieve this key milestone.

There has been growing interest in the derivatives market, with the Open Interest (OI)-weighted Funding Rate and the Volume-Weighted Funding Rate showing a gradual rise. The Volume-Weighted Funding Rate, which combines market volume and Funding Rate, stands at 0.0071% at press time, suggesting potential for continued market growth. The Open Interest-Weighted Funding Rate is also positive, indicating that unsettled contracts are predominantly held by long traders, pointing to a possible upward movement in the market.

With the growing volume and OI rising, it implies that the current long trades in the market are backed by major buying volume. This could impact the asset's price, potentially leading to a jump. The recent rise in trading volume appears to be fueled by spot traders, who have purchased $8.9 million worth of DOGE. This follows several consecutive days of buying activity. If spot market buying volume continues to increase, the DOGE rally could gain significant momentum, accelerating its progress toward the intended price target.

The Long-Short Liquidation Ratio, which compares buyer and seller losses in the market, indicates a higher number of sellers. Currently, sellers have incurred losses totaling $630,000, while long traders have recorded comparatively lower losses. This suggests increased buyer activity in the market, with buyers willing to pay a premium, potentially driving a price surge.