How Dogecoin bulls can force a rally to $0.08
Disclaimer: The information presented does not constitute financial, investment, trading, or other types of advice and is solely the writer’s opinion.
- DOGE flipped its three-day market structure bullishly.
- A move above the trendline resistance could see the meme coin rally once more.
Dogecoin [DOGE] managed to defend the $0.056 support zone yet again. Since September 2022 this has happened five times. DOGE holders were at a massive profit and the MVRV ratio has only increased over the past week.
Read Dogecoin’s [DOGE] Price Prediction 2023-24
This was one factor that raised concerns that DOGE could see a pullback. A look at the price chart also suggested that a small dip could be imminent. Here are some scenarios that traders could prepare for.
DOGE bulls battled against an HTF trendline resistance
On the three-day chart, the market structure was bullish after the move above the recent lower high at $0.06858. The RSI also crept above the neutral 50 mark to signal the bulls have an edge. The On-Balance Volume has also been on a slow uptrend since July.
Since December 2022 DOGE has formed a series of lower highs. There were some rallies in the intervening months but a convincing uptrend on the higher timeframes did not occur.
In the past month, DOGE saw another such rally. The trendline resistance from late 2022 (yellow) halted the bulls’ progress once more.
Above $0.0686 and the trendline resistance, the $0.083 and $0.095 levels were the next major resistance levels.
Hyblock data revealed some information that traders and investors could benefit from
The liquidation levels heatmap with a one-year lookback period showed that a move to the $0.081 and $0.086 regions could trigger large number of liquidations.
Now that DOGE was trading above $0.066, in the previous HTF liquidation region of interest, a move to $0.086 could be expected.
AMBCrypto’s analysis of the liquidation levels in the lower timeframes showed that short-sellers could find a profitable trade.
The Cumulative Liq Levels Delta was in the red and indicated short-sellers already in a position could face some pains were prices to climb higher. To the north, the $0.0069-$0.0705 zone has multiple short liquidations worth several million dollars.
Realistic or not, here’s DOGE’s market cap in BTC’s terms
Moreover the $0.07 area coincided with the higher timeframe trendline resistance. Therefore short-sellers could wait for another revisit of this zone before going short.
This short-term idea would be invalidated if DOGE were to climb above $0.0725. Their take-profit target would be $0.06523, close to 7% below $0.0705.