Dogecoin (DOGE) is still trading inside a corrective pattern, and yesterday the price bounced off the resistance line of this pattern.
Bullish breakout and retest
The weekly chart shows that since October 2022, the price of the popular memecoin DOGE has been declining along a descending resistance line. After 400 days, in November 2023, Dogecoin finally broke this barrier and reached a high of $0.107 the following month.
However, the token has been falling since then. In January 2024, it returned to the trend line, confirmed it as support and rebounded.
The weekly momentum indicator RSI has bounced from the neutral level of 50 and is rising, indicating a bullish trend.
What do Analysts Say?
Cryptocurrency analysts and traders on social networks are extremely positive about DOGE’s prospects. That’s because social media heavyweight X (formerly Twitter) has created a dedicated X Payments account for payments on its platform.
This is fueling speculation that Musk’s favourite DOGE will be used to make cryptocurrency payments as part of X’s strategy to introduce peer-to-peer payments functionality on its platform later this year. At the time of writing, almost 110 thousand users were subscribed to the account.
CryptoGodJohn believes that the bullish breakout and retest are already complete. He wrote: “$DOGE: bullish breakout – retest completed. We are now at a great level. Its turn into support could aim the price higher, towards $.10 A new story begins @XPayments account just created… All eyes are on rumours that X/Twitter will start using DOGE as a universal payment option on X.”
Trader Pepa suggests that the price could reach $10, and trader Cevo also refers to the above fundamental reasons, stating: “This is the best time to own some $DOGE. Even when it becomes the main currency for X Payments, it won’t be as bullish as the speculation to become one. There is literally no second best time”.
This is the best time to own some $DOGE. Even when it becomes the main currency for X Payments, it won’t be as bullish as the speculation to become one. There is literally no second best time
— cevo (@cryptocevo) January 21, 2024
DOGE Forecast: Is the price capable of a bullish breakout?
Despite the bullish weekly timeframe, the daily charts are giving different signals. Price action shows that DOGE has returned to the ascending parallel channel. The channel has existed since June 2023.
Although the token made a bullish breakout from the channel in December, it was unable to sustain gains and fell below the resistance line early in the year. Since then, he has tested the strength of this resistance line twice, the last time this happened yesterday.
The daily RSI is also at 50, indicating an undefined trend. It is likely that Dogecoin’s future trend may depend on whether the price makes a bullish breakout from the channel or bounces off resistance.
A bullish breakout from the channel could trigger a 40% rise in DOGE to the next resistance at $0.118. Conversely, a failure could result in the price falling 27% to the channel support line at $0.060.
About DOGE
The symbol of DOGE was a photograph of a Shiba Inu dog named Kabosu, who lives in Japan. In April 2023, memecoin fans announced that they were planning to make a full-fledged film about the life of a dog. In the fall, a monument to the DOGE symbol was unveiled in the Japanese city of Sakura.
In 2021, billionaire Elon Musk drew attention to the token. He repeatedly mentioned it in his publications on the social network X (formerly Twitter), which contributed to the growth of memecoin.
