- Dogecoin price action continues to recover from ten-month lows.
- DOGE could outperform several major cryptocurrencies on a confirmed breakout.
- There are risks to the downside, but the threat is limited.
Dogecoin price is nearing an important bullish breakout level that could trigger a massive upswing this weekend. It would be the strongest bullish signal in almost a year if confirmed.
Dogecoin price set to return to the $0.25 value area
On May 31, 2022, the price level that DOGE needed to close at to confirm an Ideal Bullish Ichimoku Breakout was $0.16 – but that threshold has now dropped. The threshold for Saturday is daily close at or above $0.146, and by Sunday, it drops even further to $0.14.
DOGE/USD Daily Ichimoku Kinko Hyo Chart
The daily Ichimoku chart compliments a hypothetical long opportunity on the $0.01/3-box reversal Point and Figure chart for Dogecoin price. The long idea is a buy stop order at $0.17, a stop loss at $0.13, and a profit target at $0.29.
The entry at $0.17, if triggered, would confirm the breakout above a double-top and simultaneously establish a Bear Trap pattern in Point and Figure analysis. That the Bear Trap forms at the ultimate swing low of the current downtrend gives the bullish breakout a high probability of succeeding and sustaining for a long time.
The hypothetical long opportunity for Dogecoin price represents a 3:1 reward for the risk. A three-box trailing stop would help protect any profit made post entry. Buyers should anticipate significant selling pressure against the critical psychological price level of $0.25 before moving towards the projected profit target of $0.29.