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Dogecoin has spentthe majority of the past five days trading within a tight range between $0.156 and $0.165. Notably, the meme coin is now showing early signs of stabilization after its steep correction earlier this month, with bulls beginning to reclaim ground after a drop below the $0.17 price barrier. Related Reading The $100K Mirage: Bitcoin’s Rally Not Backed By On-Chain Strength 1 day ago
Reclaiming the $0.17 level is important, according to technical analysisof Dogecoin’s price. This technical backdrop sets the stage for a projected price move to $0.21. TD Sequential Flashes Buy Signal For Dogecoin
Dogecoin’s 3-day candlestick timeframe chart shows that the meme coin is currently trading just above an ascending trendline that dates back to late 2023,which has acted as a key support level across multiple correction cycles. Despite the recent volatility, the price structure appears to be ready for a possible bouncemove from here due to the formation of less volatile candlesticks and higher lows just above the 0.5 Fibonacci retracement level around $0.165.
Taking to the social media platform X, crypto analyst Ali Martinez revealed an interesting bullishsignal taking place on the same 3-day candlestick timeframe. According to Martinez, Dogecoin has just triggered a buy signal on the 3-day TD Sequential indicator. This tool, which identifies trend exhaustion and possible reversals, has been quite usefulin predicting buy and sell zones this cycle. DOGEUSDT currently trading at $0.16. Chart: TradingView
However, the bullish outlook depends on Dogecoin reclaiming the $0.17 price level, which is now working as some sort of resistance.Martinez noted that a breakout above this price level could allow Dogecoin to rebound to $0.21. Notably, this $0.21 price target coincides with the 0.618 Fibonacci extension from Dogecoin’s October 2023 low.
Image From X: @ali_charts Path To $0.21 Needs Enough Volume
For Dogecoin to confirm a return to $0.21, market participation must returnin a meaningful way. This is because Dogecoin’s trading volume has been notably low over the past few days. According to data from CoinMarketCap, Dogecoin’s 24-hour trading volume is currently at just $400 million, which is a 36.7% decrease from the previous day. This level of activity is significantly below Dogecoin’s usual trading volume during periods of upward momentum. Related Reading Stablecoin Skepticism Grows As IMF Official Challenges Their Money Role 1 day ago
Such a slowdown in volume suggests that, despite the bullish technical signal from the TD Sequential indicator, the necessary follow-through from buyers is yet to be confirmed.
At the time of writing, Dogecoin is trading at $0.1637, up by 1.7% in the past 24 hours. Until volume picks up, Dogecoin may continue to consolidate or even drift sideways, regardless of the bullish indicators. Unless there’s strong interest and stronger inflows, the breakout setup could fizzle out or result in another rejection at $0.17.
Featured image from Unsplash, chart from TradingView