Dogecoin signals potential recovery: Will THIS fuel DOGE to $1?

• Dogecoin shows multiple bullish signals, notably with the RSI on the 4-hour chart.
• DOGE’s activity has been steady, with daily active addresses and whale movements at key levels.

Dogecoin’s [DOGE] chart revealed critical bullish signals through its 4-hour Relative Strength Index (RSI) and price channels.

The RSI, deeply entrenched in the oversold territory with a reading near 48 at press time, suggested a potential turnaround for Dogecoin’s price.

This was reinforced by the RSI’s upward-trending channel, indicating a strengthening momentum despite the downtrend in DOGE’s price channel.

Furthermore, DOGE showed a bullish divergence as it retested the top of its broken channel, near $0.255 at the time of writing.

This retest represented a critical moment—either confirming a bullish reversal or failing, which could resume the downtrend.

Source: Trader Tardigrade/X

If the ‘king of memecoins’ sustains above the channel top, it could ignite a rally towards the next resistance at $0.27. If the price breaks above $0.27, DOGE could return to $0.5 level and potentially $1 before mid-year.

Conversely, a failure to hold above the retested level could see DOGE slide back to support around $0.24, reiterating the volatility and speculative nature of the memecoin.

Each move, whether a break or a bounce, will be pivotal in determining DOGE’s trajectory in the coming days.

Dogecoin’s on-chain activity stabilizes

DOGE’s activity chart reflected a steady engagement level with its network despite the price fluctuations.

The number of daily active addresses consistently aligned with significant transaction volumes and whale transactions, suggesting a solid foundational interest in DOGE.

In December, daily active addresses peaked concurrently with a surge in transaction volume, indicating heightened activity that temporarily supported a price increase.

Notably, whale transaction counts for transactions that were over $1 million showed occasional spikes that correlated with both price peaks and troughs, hinting at potential key market movements following these activities.

Source: Ali/X

At press time, the price of DOGE was at $0.252, with transaction volumes suggesting robust activity despite a downward trend.

If this activity level persists or increases, it might signal a potential bullish reversal for DOGE that could fuel a move towards $1.

Conversely, a decline in these metrics could further the bearish trend, emphasizing the importance of sustained high levels of engagement for price recovery.

An uptick in whale transactions coupled with increased active addresses could catalyze a rally.

However, if these metrics wane, it might confirm a continuing price decline, emphasizing the critical role of network activity in determining Dogecoin’s market direction.