Key takeaways:
DOGE’s Adam and Eve pattern and Fibonacci confluence point to a 25% upside.
Heavy short liquidation zones above $0.216 could fuel a sharp rally.
Dogecoin ( DOGE ) jumped 2.5% to $0.20 as the market’s attention turned to Elon Musk’s latest X post , featuring the memecoin mascot Shiba Inu. DOGE price surged 29% in response .
The move extended DOGE’s sharp rebound from its recent low of $0.13, its lowest level since April, marking a 55% recovery in just two weeks.
Musk’s tweets famously fueled DOGE’s explosive 2021 rally from mere cents to nearly $0.73.
Now, with sentiment improving and multiple technical indicators flashing bullish signals, the top memecoin appears poised to extend its recovery in the second half of October.
DOGE’s A&E indicator hints at 25% gains next
Dogecoin is forming an Adam and Eve double-bottom pattern, a bullish reversal setup where a sharp “V”-shaped drop (Adam) is followed by a rounded recovery (Eve). This pattern signals that selling pressure is fading while buyers are regaining control.
DOGE’s neckline sits near $0.216, and a confirmed breakout above this level could trigger a move toward $0.260, about 25% higher than current prices.
The target aligns with the pattern’s measured move projection and coincides with a key technical confluence zone. It also matches the 0.382 Fibonacci retracement level on DOGE’s weekly chart, as shown below.
The rebound prospects gain further strength as DOGE rebounds from a support confluence comprising an ascending trendline and a 0.236 Fib line, reinforcing the idea that buyers are defending lower levels, while eyeing $0.26 as the interim upside target.
Short squeeze can help DOGE reach $0.26 target
Futures data shows a heavier concentration of short liquidations between $0.215 and $0.27, while long liquidation levels remain relatively flat below $0.18.
This imbalance suggests a lower downside risk, with fewer leveraged longs positioned to trigger significant sell pressure. Conversely, the upside has a dense liquidity wall of shorts waiting to be squeezed.
Related: DOGE holders are buying dips: Is $1.60 by 2026 realistic?
Therefore, a breakout above the $0.216 neckline could unleash a wave of short liquidations, accelerating a move toward $0.26 as bearish traders are forced to buy back into the rally.