While most alts have been posting sharp gains on the back of a BTC recovery, Dogecoin has seemed to fall into a lull. Its price has moved sideways for a week and a half with slight gains of 3%. As market observers and Dogecoin enthusiasts await its next rally, indicators aligned towards a favorable outcome in the coming days. At the time of writing, Dogecoin traded at $0.249, up by a marginal 0.09% over the last 24 hours.
Dogecoin Daily Chart
Source: DOGE/USD, TradingView
DOGE’s sideways movement continued for a ninth straight day as equilibrium remained intact between the buyers and sellers. The daily 20-SMA (red) has acted as a resistance line during this period and has denied a bullish breakout. However, its uptrend on 22 June and lateral movement thereafter led to the formation of an ascending triangle.
A close above the upper trendline, which rested along the $0.280 mark, would likely trigger the next DOGE rally. Such an outcome could see prices rise towards the $0.326 level- an area that coincided with the daily 50-SMA (yellow). Moreover, a successful rise above $0.326 would put buyers back in the driving seat from where an extended rally would be possible.
ReasoningÂ
DOGE’s indicators reflected a balanced market but there were a few positives. Even though MACD line was nearly superimposed on the Signal line, its histogram suggested that bulls had the upper edge. Squeeze Momentum Indicator highlighted receding bearish momentum as buyers prepared to initiate the next upswing. On the downside, Directional Movement Index still noted bearish conditions as -DI remained above +DI. An ADX reading of 22 suggested that the market was not directional to register sharp movements just yet.
While the consolidation phase continues, it’s important for bulls to maintain prices above their 19 May swing low of $0.215 as a close below this level would negate chances of an upwards breakout.
ConclusionÂ
Dogecoin was tipped to resume its sideways movement for at least a few more days before volatility picks up in the market. The indicators paved way for an upwards breakout- one that could boost prices towards $0.326. However, traders must be cautious as a move below $0.215 could risk DOGE losing its bullish structure.
