- Dogecoin bounced off a historically significant level on Monday.
- DOGE bulls saw short-sellers coming in hard at the monthly pivot.
- Price action consolidates this morning and could be set for a bullish breakout towards $0.19.
Dogecoin (DOGE) is slowly but surely breaking out of the downtrend that it has been in since November. With the historical level at $0.13 holding firm, investors have loaded up and punched a hole through the $0.16 resistance barrier but have since been unable to keep the rally going. Today Dogecoin price is consolidating near the red descending trend line and looks like it will bounce off it as markets gear up for a second consecutive day of gains, adding to the overall tailwinds in cryptocurrencies.
Dogecoin thrives on current tailwinds and is set to hit $0.19 by the end of this week
Dogecoin price has been keeping investors worried since November with a sharp downturn that now looks to be coming to an end. Bulls have been able to turn the tide, and with a little bit of help from yesterday’s joyous, upbeat trading day are currently consolidating price action above the red descending trend line. In this way, bulls are seen breaking out of the decline and kicking off more inflow into Dogecoin from sidelined investors.
DOGE is already seeing a substantial uptick in the Relative Strength Index as proof the trend is changing. Further demand on the buy-side could push DOGE price back above $0.16 today and make bulls face the monthly pivot for a second test at $0.17, a level which saw a sharp, violent reaction and fade when it was last touched. If these supportive factors keep persisting, expect DOGE price action to touch $0.19, with the 55-day Simple Moving Average as a possible earlier halt in the rally before Friday.
DOGE/USD daily chart
As this rally depends on tailwinds created by the positive recovery in global markets, the opposite – a negative decline in markets – would probably lead to a sharp sell-off. This would likely see price action enter back below the red descending trend line, essentially making the current breakout a false one. From there, the pressure would likely mount on $0.13, with a push lower once it breaks. The monthly S1 at $0.12 is a supporting element, reinforcing the floor made by the lows of the ‘falling knife’ on December 04.
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