The Dogecoin price has been consolidating for the past five days, leading some analysts to conclude that DOGE may be on the rise.
Recently, the price of Dogecoin rose 45% from $0.065 to $0.095 and surpassed the barrier of $0.087. This came after DOGE collapsed 50% on May 6. This recovery is likely to continue, but it will not be easy.
Given that the narrowing of the range is above a stable support level, the chances of a bullish breakout are not far-fetched.
However, the bulls would need to break the $0.101 barrier to move higher and retest the $0.125 target. This move would constitute a 40% upside from the current position at $0.089.
This bullish Dogecoin price forecast is supported by an extremely oversold 365-day market value to realized value (MVRV) condition.
This intra-net metric is used to determine the average gain/loss of investors who bought DOGE over the past year. According to the Santiment study, a value below -10% indicates that short-term holders are at a loss and are less likely to sell.
Long-term holders most often represent this sample. Consequently, any movement below -15% is called an “opportunity zone”.
For DOGE, the 365-day MVRV fluctuates at -58%, well below the March 2020 value of -38%. This figure means that most DOGE holders are in the negative and unlikely to sell. It also indicates that the cryptocurrency is in a good position to accumulate.
A daily candle close below $0.062 would negate the bullish potential of Dogecoin, creating a lower low. As a consequence, DOGE could fall 25% to retest the support level at $0.046.