Dogecoin price begins consolidation after sharp reversal from resistance

• Dogecoin price enjoying the spoils of cult status.
• January 29 high didn’t factor in as resistance.
• Started as a joke, DOGE providing once-in-a-lifetime returns in 2021.

Dogecoin price rallied over 120% from the ascending triangle pattern trigger price in just four days thanks to the renewed hype from leading DOGE proponents such as Mark Cuban, Elon Musk, and Guy Fieri. Yet, all attention could not overcome the 161.8% extension of the late January reversal at $0.151, turning the attention to support points for the necessary consolidation.

Dogecoin price performance is a puzzle for academics

In an FXStreet article from April 10, it was projected that a daily close above the $0.068 would unleash a “trip to the moon,” and it was, unleashing the largest 3-day gain since the massive late-January spike. 

Today, the DOGE rally has come to a halt after reaching a similar overbought reading on the daily Relative Strength Indicator (RSI) as the peak on January 2. This occurred while almost hitting the 161.8% extension of the late January drop at $0.151. 

The consolidation should find credible support at the 23.6% retracement of the rally from the January 30 low at $0.118, but the more extensive support comes at the confluence of the 50% retracement at $0.101 and the January 29 high at $0.100. The February high rests slightly below at $0.094. A daily close below that level would be the end of another celebrity-driven rally.

DOGE/USD daily chart

Speculators need to be mindful that momentum can stay overbought longer than you think. For that reason, they should note the 261.8% extension of the January decline at $0.231 as the next potential resistance level. It would represent a 50% return from today’s high.

Greater expectations for DOGE need to factor in the 361.8% extension at $0.312.

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