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Dogecoin (DOGE) made a surprising price comeback this week after initially dropping by almost 14% due to a technical signal known as a "death cross." This bearish signal appeared just as DOGE fell from around $0.16 to approximately $0.137, marking one of its largest weekly declines since April.
However, rather than continuing to drop as traders expected, Dogecoin performed a U-turn and bounced back strongly.
By Tuesday, Dogecoin had recovered above the $0.16 mark, taking traders by surprise. Many people had bet on DOGE dropping further after the death cross appeared because they thought it would follow historical patterns.
Nevertheless, the oversold conditions and thin liquidity made it the perfect time for a sudden turnaround. When DOGE surged, short sellers had to quickly close their positions, which pushed prices up even faster.
DOGE spikes are often associated with high-profile endorsements or headlines. Instead, this bounce appears to be primarily technical, driven by market dynamics and the broader stabilization of the cryptocurrency market.
Following last week's substantial sell-off, Bitcoin remained stable above $100,000, while Ethereum found its footing near the $2,600 mark. With these key assets stable, traders felt more confident about taking short-term risks with higher-risk coins such as DOGE.
Currently, DOGE is facing resistance at around $0.165–$0.17, which were key breakdown points in late May. If it breaks convincingly above this zone, the momentum could shift positively, opening the door to a potential move up toward $0.20 — the price at which the death cross first appeared.
Should DOGE not hold above the current resistance level, the rally could quickly fade, rendering this week's surge just another temporary market correction.
Dan Burgin
Vladislav Sopov
U.Today Editorial Team