Dogecoin enthusiasts have reason to be cautiously optimistic as Bitcoin recently surged above $106k, hinting at possible short-term gains for the beloved memecoin.

Despite its struggles last week, where Dogecoin faced rejection at the significant resistance level of $0.20 and dipped to a local low of $0.17, Bitcoin’s rally from $105.6k to $108.4k—marking a 2.72% increase—could signal a shift in the market.

However, the broader macroeconomic landscape remains uncertain, especially with ongoing tensions in the Middle East, contributing to a generally bearish outlook for long-term investors in Dogecoin.

A report from AMBCrypto emphasizes an interesting trend among altcoins, revealing that around 70% show a notable long bias, particularly in large-cap assets where 60% of traders are optimistic about future recoveries following last week’s market corrections.

But should Dogecoin traders also adopt a more bullish sentiment?

Currently, Dogecoin appears to be grappling with persistent bearish pressure. Crypto analyst Ali Martinez noted that while buy signals have emerged on Dogecoin's 12-hour chart, the overall high-timeframe bias remains firmly bearish.

Adding to the concern, indicators like the On-Balance Volume (OBV) suggest increased selling pressure, alongside a bearish Relative Strength Index (RSI), making it tough for Dogecoin to break past the $0.20 resistance.

Moreover, data reveals that Dogecoin holders with investments of six months or less are in a distribution phase, indicated by a declining mean coin age over the past five weeks. This trend signifies that coins are shifting from holding wallets to being sold, aligning with spikes in dormant circulation.

The 180-day Market Value to Realized Value (MVRV) ratio remains in negative territory, which could be discouraging for potential investors. Although the TD Sequential and Bitcoin's bounce might tempt traders to go long, investors should proceed with caution.

As the market continues to fluctuate, will Dogecoin be able to capitalize on Bitcoin’s momentum, or are further declines on the horizon? Stay tuned!