price of Dogecoin (DOGE) has moved lower since it hit a new all-time high on May 8.
token stopped its decline with a strong bounce on July 21 and created a short-term bullish pattern, which could lead to a strong bounce.
DOGE finds support
DOGE was subject to a massive price increase starting in March 2020, leading to the high price of $ 0.74 on May 8, 2021.
In just over a year, the token has grown 65.122%.
However, it has moved lower since the all-time high was reached.
On July 20, it touched a low of $ 0.159. low was reached very close to the 0.786 Fib retracement support level at $ 0.157, a likely area for a bounce.
Technical indicators are relatively neutral, although they do show some bearish signs. While the MACD is declining, it is still positive. RSI is right at the 50 line. However, the stochastic oscillator has created a bearish crossover.
next support is completely below $ 0.08.
logarithmic chart is used in the image above to better visualize large price fluctuations.
Does double bottom lead to a bounce?
daily chart supports the possibility of DOGE bouncing off the current level.
On June 22 and July 20, DOGE created a double bottom, known as a bullish reversal pattern. Also, the pattern was combined with bullish divergences on the RSI and MACD. refore, an upward movement is likely.
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closest resistance levels are at $ 0.27 and $ 0.43, both of which are horizontal resistance areas.
Cryptocurrency trader @Tradinghubb outlined a chart of DOGE, indicating that the token is likely to bounce back to $ 0.45 before another eventual drop.
decline from all-time highs resembles a major diagonal, which was likely Wave A of an ABC (white) corrective structure.
DOGE came out of the wedge, probably starting wave B in the process.
Since the decline was a five-wave pattern, the most likely level for the top of the subsequent correction is between the 0.5-0.618 Fibonacci Retracement Resistance Levels at $ 0.45-0.52.
However, a more precise target is likely to emerge once the corrective structure begins to form.
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