Dogecoin price needs to retrace for DOGE to rally another 30%

Dogecoin price rallied exponentially over the past 24 hours, slicing through a crucial supply zone and flipping it into support. This move, while bullish, needs to retest the newly formed demand barrier to confirm the presence of buyers.

If successful, DOGE might soon kick-start a new uptrend, coming close to its pre-May 19 crash levels.

Dogecoin price prepares for a pullback

Dogecoin price rallied roughly 22% over the last 24 hours, shattering the immediate supply zone extending from $0.28 to $0.31. A correction here is likely due to the extended nature of the upswing and the sell signal flashed by the Momentum Reversal Indicator (MRI) in the form of a red ‘one’ candlestick. 

This technical formation forecasts a one-to-four candlestick correction, hinting at a retracement to the immediate support level at $0.33. An increased number of investors booking profit could lead to a breakdown of $0.33 and a retest of $0.31, the demand zone’s upper limit.

Investors can expect a resurgence of buyers at $0.31 or $0.33, leading to the start of a new uptrend.

The resulting bullish momentum will likely breach $0.37 and make a run at the $0.40 resistance barrier.

DOGE/USDT 9-hour chart

On the other hand, if the retracement continues to head lower, breaching $0.31, DOGE will reenter the demand zone ranging from $0.28 to $0.31. While a consolidation within the range mentioned would only delay the upswing, a decisive 9-hour candlestick close below $0.28 will invalidate the bullish thesis.

In such a case, market participants can expect the meme coin to retest $0.27.