It also increases the odds of a squeeze as a significant volume of stop orders tends to sit above those key levels. Meanwhile, a strong pullback is on the table at this point as well, but it won’t invalidate the rally necessarily.
The reason for this is that the daily RSI just hit extreme overbought levels. Since we are already seeing strong resistance at these levels, the odds of a big drop are high. If that happens, we could see DOGE declining to $0.10 again to raise the necessary liquidity for the next leg up.
Meanwhile, if we get a bullish breakout, the first target would be $0.13, followed by a strong move to $0.15. This gives us a great setup for a trading opportunity with an entry at $0.12 if a breakout occurs and with two clear take-profit targets.
This trade offers a 3x to 4x risk-reward ratio depending on how cautiously you set the stop price.
Buy Signals Piled Up Ahead of This Breakout
Our system picked up three “buy” signals during DOGE’s accumulation phase that are consistent with what we see in the daily active users chart. This confirms an ongoing accumulation back then, while the latest breakout and short squeeze are a result of rising buying pressure.
