DOGE/USD: Trend Remains Bullish Despite Sharp Drop

DailyForex.com Team

Now that we've concluded that Dogecoin is strongly bullish, what happens next?

Since the last highs that Dogecoin reached around $0.75, the asset has devalued more than 70%. Despite this decline, the overall trend remains bullish, so we must be cautious if we plan to go short Dogecoin.

Despite being down for several days and marking what seems to be a new downtrend with lower lows and lower highs, the price failed to decisively break the area around $0.23, which is where the previous relevant support is located.

Furthermore, if we activate the 100- and 200-period moving averages in a macro timeframe such as the daily, we observe that the price is still above these two indicators, which indicates that the asset continues to have bullish strength, giving validity to the above.

Now that we've concluded that Dogecoin is strongly bullish, what happens next?

In the long term we have a strong support around $0.23. This level is very relevant, as it has been the one that has kept the asset above these prices always in two of the most important setbacks: the April correction and the current one. In addition, right at these levels we find the 100-period moving average, which could act as a confluence with the zone.

On the other hand, if this scenario is not fulfilled and the price decides to go up, we would need to see a decisive break around $0.45, which is where the next resistance is located. If this break occurs, there would be a great probability of seeing Dogecoin attack the historical highs again. Otherwise, the price will remain in a range between $0.45 and $0.23.

DOGE/USD

Is there an opportunity to go long or short in the short term? If we look at the price structure, we see that the price has already gone to the bottom of the range, so there is a high probability that it wants to go to the top around $0.45. If we add to this the break of the downtrend line that is occurring and that the price is around 50% of the range being a very well-validated level in past data, it could be considered a good area to enter long and thus follow the uptrend.

DOGE/USD

DailyForex.com Team
The DailyForex.com team is comprised of analysts and researchers from around the world who watch the market throughout the day to provide you with unique perspectives and helpful analysis that can help improve your Forex trading.

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