In a volatile market environment, the Dogecoin price has experienced sideways movement, fluctuating between $0.075 and $0.069. Using the $0.069 mark as base support, the meme-inspired cryptocurrency displays the formation of a double bottom pattern. This bullish setup, typically seen at market bottoms, offers a significant upswing on the breakout of its neckline resistance. Traders may see potential long opportunities using this pattern.
Dogecoin’s price has indeed established a double-bottom pattern that predicts an 8.5% increase with a successful breakout from $0.075. It is essential to note that any reversal signs at $0.075 may indicate the continuation of a sideways trend. The 24-hour trading volume in Dogecoin currently stands at $328.5 million, signifying a 36% gain.
On May 25th, Dogecoin’s price rebounded from the local support zone of $0.069, driving the prices 4.88% higher to reach $0.072. Nonetheless, due to the development of the double bottom pattern, the bullish upswing is likely to climb further and confront the immediate resistance of $0.0755. This resistance functions as the neckline of the chart pattern and marks the peak of the ongoing consolidation phase.
A successful break above $0.072 will subsequently boost buying pressure, propelling the price of DOGE by 8.5% to reach the $0.082 benchmark. Influenced by the double-bottom pattern, Dogecoin’s price is expected to overcome the overhead resistance of $0.075. A breakthrough above this barrier would provide a solid base for buyers to prolong the recovery and hit $0.082.
Nevertheless, while the bullish prospects may seem promising, it is crucial to consider certain technical factors that may affect price momentum. The daily Relative Strength Index (RSI) displays a bullish divergence, indicative of increasing buying pressure at lower levels and further confirmation of an upward rally. However, the dynamic resistance of the 20-day Exponential Moving Average (EMA) obstructs the ascending price, potentially compromising the bullish outlook.
As with any investment, thorough market research is necessary before diving into cryptocurrencies, since the personal opinions of authors and the market’s ever-changing condition. Investors must not overlook their responsibility in managing personal financial loss. Ultimately, while Dogecoin’s price shows a promising setup, one must weigh the potential risks and rewards before committing.
Source: Coingape
