Dogecoin bull run gains momentum after brief market dip

Dogecoin (CRYPTO:DOGE) has resumed its bullish trajectory following a recent market downturn that saw its price drop to $0.083.

The meme coin has since regained value, raising questions about the sustainability of this recovery and its potential for further gains.

Recent data from Santiment highlights that Dogecoin’s Market Value to Realized Value (MVRV) Z-Score, a key indicator of whether an asset is undervalued or overpriced, briefly turned negative during the market dip.

Historically, a negative MVRV Z-Score has often signaled the potential for a bull market, as short-term holders tend to benefit more during these periods.

This pattern, last seen in February and October 2023, suggests that Dogecoin could be primed for another upward move.

Further supporting this outlook, data from IntoTheBlock’s Bulls and Bears indicator shows that there are currently more bullish than bearish addresses in the Dogecoin network.

Bulls, defined as addresses that bought at least 1% of the trading volume, are outnumbering bears, which could lead to a significant price increase if the trend continues.

On the technical front, Dogecoin is approaching a critical resistance level on the weekly chart.

The coin is on the verge of breaking out of a descending triangle, a pattern typically associated with bearish trends.

However, DOGE appears to be pushing above the 78.6% Fibonacci retracement level, a key indicator that could signal further price gains.

If Dogecoin successfully breaks through this level, its price could target $0.16 in the mid-term, with the potential to reach $0.22 in the long term.

However, this bullish outlook could be challenged if the broader market enters a bear cycle, which might cause Dogecoin’s price to drop as low as $0.049.

As Dogecoin continues its recovery, market participants will be closely watching these key levels and indicators to gauge the coin’s next move.

At the time of reporting, the Dogecoin (DOGE) price was $0.1096.