Dogecoin (DOGE) is one of the top performers among major cryptocurrencies in the past week, having risen more than 20% during the period, according to coin market cap data. The meme coin is witnessing profit-booking in the week beginning 28 November 2022 but is trying to stay above $0.09.
Although it is difficult to pinpoint a specific reason, the rally in Dogecoin may have been triggered by the hope that Elon Musk, the new CEO of Twitter, may include Dogecoin as one of the payment systems in Twitter 2.0. The speculation picked up momentum after Musk shared slides from his “Twitter company talk”. However, the slides did not mention dogecoin.
Slides from my Twitter company talk pic.twitter.com/8LLXrwylta
— Elon Musk (@elonmusk) November 27, 2022
Another theory thrown in by David Gokhshtein, a cryptocurrency influencer and founder of Gokhshtein Media, was a purported collaboration between Musk and Ethereum’s co-founder Vitalik Buterin to “somehow upgrade DOGE”.
I feel that we’ll all see Vitalik and Elon working together to somehow upgrade $DOGE.
— David Gokhshtein (@davidgokhshtein) November 25, 2022
While speculation could pump a coin, it was unlikely to sustain without the support of fundamentals. Is it time to book profits or could dogecoin go up further? Read the DOGE price analysis to find out.
Dogecoin price technical analysis: Weekly chart
DOGE’s price has been attempting to form a higher low at $0.07. The DOGE/USD pair soared to $0.16 a few weeks back where it witnessed profit-booking. A minor positive is that the bulls are trying to arrest the decline at the 20-week exponential moving average (EMA). This suggests that traders are not waiting for a deeper fall to buy.
The 20-week EMA has flattened out and the relative strength index (RSI) is just above the midpoint, suggesting that the selling pressure could be reducing.
If buyers push and sustain the price above the 50-week simple moving average (SMA), the pair could attempt a rally to $0.16. This level could act as a major hurdle, but if bulls overcome it, the pair could pick up momentum and climb toward $0.33.
Contrary to this assumption, if the price turns down from the current level and breaks below $0.07, it will suggest that bears are active at higher levels. That could open the doors for a possible drop to the June low near $0.05.
Dogecoin price technical analysis: Daily chart
After consolidating for the past few days, Dogecoin’s price broke above the range on 27 November. The recovery rose above the psychological level of $0.10, but the bulls could not sustain the higher levels, as seen from the long wick on the day’s candlestick.
This indicates that the bears are mounting a strong defence at the 38.2% Fibonacci retracement level of $0.10. However, a minor positive is that the bulls are trying to buy the dips to the 20-day EMA. This indicates a change in sentiment, from selling on rallies to buying on dips.
If buyers thrust the price above $0.11, the up-move could reach the 61.8% retracement level of $0.12. This level may again pose a strong challenge to the bulls but if cleared, the next stop could be $0.16.
This positive view could invalidate in the near term if the price turns down and breaks below the moving averages. Such a move could result in a retest of the strong support at $0.07.
Dogecoin: Buy or sell this week?
Dogecoin is attempting to bounce off the moving averages. Buyers will have to clear the overhead hurdle at $0.11 to signal the resumption of the up-move. The pair could then rally to $0.12 and thereafter to $0.16. Conversely, if the pair turns down and breaks below the moving averages, dogecoin’s price analysis suggests a drop to $0.07.
The views and opinions expressed in the article are those of the author and do not constitute trading advice. Trading and investing involve substantial risks and you should do your own research or contact your financial adviser before arriving at a decision.
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