- Dogecoin (DOGE) could potentially gain 33% if it overcomes the critical resistance at $0.12 and the 200-day MA at $0.13, driven by strong buying pressure and reduced selling from miners.
- However, profit-taking at these resistance levels could hinder its rally.
Dogecoin (DOGE) has been making waves, showing a 15% increase on the weekly charts. However, the memecoin faced a critical resistance at its former Q3 support level of $0.12. To catch up with Shiba Inu (SHIB), which boasted a 36% weekly gain, DOGE needs to clear this significant hurdle to potentially rally by 33%.
DOGE’s Performance and Key Resistance Levels
Dogecoin seemed to be playing catch-up to an explosive rally fronted by Shiba Inu on Thursday. Despite DOGE’s respectable gains of 15%, it pales in comparison to SHIB’s impressive 36% surge over the same period. Nevertheless, there is still a possibility for DOGE to achieve a 33% gain, contingent upon overcoming a critical roadblock.
On the daily charts, DOGE retested its Q2 support level at $0.12, but it has remained below this level since late July. Reclaiming this support could set DOGE on a path to target $0.16, representing a potential 33% increase. However, a significant obstacle lies at the 200-day Moving Average (MA) at $0.13. A strong move above this moving average could accelerate DOGE’s upswing to $0.16.
Indicators and Market Sentiment
The rising trading volume, as indicated by the On-Balance Volume (OBV), and a bullish Relative Strength Index (RSI) suggest strong buying pressure, which could support DOGE’s attempt to reclaim its Q2 support. However, if DOGE faces a price rejection at $0.12, the bullish outlook could be invalidated.
In the futures market, DOGE also showed a bullish sentiment with a sharp rise in Open Interest (OI) and significant liquidations of short positions. In the last 24 hours alone, approximately $5 million worth of short positions were liquidated. This activity suggests that market participants are anticipating a further rise in DOGE’s price.
Miner Behavior and Market Dynamics
Miners, who play a crucial role in DOGE’s supply dynamics, have been holding steady with their mined tokens since August. This trend intensified from July, as indicated by a spike in the supply held by miners. The reduced supply pressure from miners could provide DOGE with more room to rally further.
However, it’s important to note that the recent rally to $0.12 has brought about 75% of DOGE holders into unrealized profit. If these holders decide to take profits at the resistance level of $0.12, it could potentially derail DOGE’s recovery.
Dogecoin is on the brink of a significant move, with potential gains of 33% if it can overcome key resistance levels. The bullish indicators, combined with reduced selling pressure from miners, create an optimistic scenario for DOGE. However, market participants should remain cautious of profit-taking at critical resistance points, which could hinder the anticipated rally.
DOGE’s journey to $0.16 hinges on its ability to clear the $0.12 resistance and surpass the 200-day MA at $0.13. If these milestones are achieved, DOGE could indeed catch up to SHIB’s explosive gains, propelling it towards new heights.
About the Author
