- Dogecoin price has bounced off the POC at $0.066 and rallied roughly 5%.
- This move could push DOGE up to a high time frame resistance level at $0.078.
- Investors must factor in the potential liquidity sweep below $0.057 before flipping bullish on the meme coin.
Dogecoin price is rallying while some altcoins are rallying. This development is no doubt bullish for DOGE it could also serve as a warning sign that this move could reverse quickly.
Dogecoin price gets ahead of itself
Dogecoin price seems to be taking a bullish route after bouncing off the stable support level at $0.066, which is also the volume profile’s point of control (POC) for the last 100 days. This level is the highest traded volume point, hence, functions similar to a support or resistance level.
While altcoins took a hit over the last 12 hours, DOGE seems to have absorbed the selling pressure and has reversed the trend and even rallied 5%. While this does seem bullish, investors need to pay close attention to Bitcoin, which shows a bearish bias.
Hence, this uptrend for DOGE could be a long squeeze. As mentioned in previous articles, a retracement in Dogecoin price to collect the sell-side liquidity resting below equal lows formed at $0.05 seems like a logical move.
Once the liquidity is collected, investors can flip their bias favoring bulls and ride the rally that emerges. The said uptrend is likely to push DOGE through the POC at $0.066 and the $0.078 resistance level and reaches its target at $0.11. This move, in total, would constitute a 90% gain.
DOGE/USDT 1-day chart
While the idea of a 90% upswing for DOGE seems appealing, investors also need to consider the invalidation thesis. If the Dogecoin price fails to react to the demand zone due to excessive selling, things could turn ugly swiftly.
A daily candlestick close below the demand zone’s lower limit at the $0.048 level, will not only invalidate the structure but also create a lower low, shifting the narrative favoring bears. This development will also put an end to the bullish thesis and could result in Dogecoin price retracement to $0.045 or $0.040 levels.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended Content
Editors’ Picks
Bitcoin, Ethereum prices struggle after mixed US NFP data
BTC and ETH prices experienced a temporary pullback as crypto market participants reacted to the news of the US NFP data release for May. Similar to the situation in April, the number of Nonfarm Payrolls added far exceeded the market’s expectations.
Solana: A break above $26.30 would spell doom for bears
SOL price has been trading with a bullish bias after an explosive breakout on December 30. However, because of volatility and the gloom in the broader crypto market, SOL has been unable to break above a key hurdle at $26.30, causing the price to trade sideways.
Bitcoin Weekly Forecast: BTC targets $30,000 as short-term bias turns bullish
Bitcoin (BTC) price shows a clear sign of the bulls’ victory. After failing to trigger a steep correction, bears look now out of context, at least in the short term, allowing buyers to restart a minor uptrend.
China crypto community picks Ethereum, Arbitrum and BNB Chain as top protocols
Ethereum, Arbitrum and BNB Chain protocols are top picks for the Chinese crypto community, data from a report shows, a possible bullish catalyst for tokens related to these protocols as Hong Kong opens the door of crypto to retail investors.
Bitcoin: BTC targets $30,000 as short-term bias turns bullish
Bitcoin (BTC) price shows a clear sign of the bulls’ victory. After failing to trigger a steep correction, bears look now out of context, at least in the short term, allowing buyers to restart a minor uptrend.