DOGE/USD: Support Zone Can Rekindle Bullish Trend

Ibeth Rivero

Traders should take advantage of short-term selling pressure with new buy orders on the back of improving upside potential.

Following the recent massive rally on Dogecoin, a recent analysis revealed that one Dogecoin address accumulated 28% of all available coins. The value exceeds $2 billion, and Elon Musk speculated that trading app Robinhood became the top dog in Dogecoin. The DOGE/USD retreated from shy of 0.09000 into a short-term support zone. It offers traders an excellent platform to rekindle the bullish trend and attempt a run at 0.10000.

The Force Index, a next-generation technical indicator, remains below its horizontal resistance level. It is trapped above its ascending support level and below its descending resistance level, as marked by the green rectangle. Rising bullish pressures can elevate this technical indicator above the 0 center-line and into positive territory, handing bulls control over the DOGE/USD.

Financial markets should start to take the fringe cryptocurrency seriously, given the rising support behind Dogecoin. Some believe that it can become the currency of the internet. While its founders initially intended it more as a joke, it quickly attracted a community, which now includes many influencers. The DOGE/USD retreated into its short-term support zone between 0.04750 and 0.05376, as identified by the grey rectangle, from where a breakout is possible.

One of the most powerful drivers for Dogecoin is the collective belief and support that it can become something a lot more significant in the future than it is today. It also trumps fundamentals, which continue to improve. The DOGE/USD can swiftly accelerate into its resistance zone between 0.07898 and 0.08888, as marked by the red rectangle, from where the ascending Fibonacci Retracement Fan sequence can pressure price action into its psychological resistance level of 0.1000.

DOGE/USD Technical Trading Set-Up - Breakout Scenario

  • Long Entry @ 0.05020

  • Take Profit @ 0.10000

  • Stop Loss @ 0.04020

  • Upside Potential: 4,980 pips

  • Downside Risk: 1,000 pips

  • Risk/Reward Ratio: 4.98

In case the descending resistance level pressures the Force Index to the downside, the DOGE/USD may face more short-term selling pressure. Traders should take advantage of it with new buy orders on the back of improving upside potential. The downside remains confined to its support zone between 0.0301 and 0.0341.

DOGE/USD Technical Trading Set-Up - Temporary Breakdown Scenario

  • Short Entry @ 0.03820

  • Take Profit @ 0.03320

  • Stop Loss @ 0.04020

  • Downside Potential: 500 pips

  • Upside Risk: 200 pips

  • Risk/Reward Ratio: 2.50

DOGE/USD chart

Ibeth Rivero

Ibeth contributes daily market commentary in both English and Spanish (both of which she speaks fluently) and she also manages the DailyForex mobile app to ensure that traders around the world are getting important market updates in real time.

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