Dogecoin Is Nearing Long Term Support Will It Burst

To end the sustained decline since August 16, Dogecoin (DOGE) needs to break the current pattern.

Technical indicators do not confirm the possibility of a reversal. However, the price action suggests that a breakout is the most likely scenario.

Continue to decrease

DOGE has been down since Aug 16 when it hit a high of $ 0.35. The drop has taken the form of a descending, expanding wedge. This is considered a bullish pattern, meaning that a breakout above this pattern is more likely than a breakout below it.

However, technical indicators do not confirm the possibility of an outbreak.

MACD is below the 0 line and has started to decline. In addition, the RSI is right at the 50 line. The RSI is a momentum indicator and a value of 50 is a sign of a neutral trend.

Therefore, indicators in the daily timeframe are not enough to determine the direction of the trend.

However, DOGE has strong support at $ 0.20. This level is generated by both the horizontal support area and the super trend line (green symbol). Supertrend is an indicator that uses absolute high and low prices to determine whether the trend is bullish or bearish. Since the price is above the supertrendline, the trend is viewed as bullish. Alternatively, this line can serve as a support.

As a result, a ricochet is expected if DOGE falls there.

Daily DOGE / USDT Chart | Source: TradingView

Count waves

Trader @Thetradinghubb has outlined a DOGE chart where the token should rise to at least $ 0.44 and possibly an all-time high.

The source: Twitter

The first possibility suggests that the move up is an ABC correction. This means that all of the gain is an adjustment. Therefore, once close, DOGE will drop to a new low.

There is still some upside movement before it falls, however.

The levels likely to act as the pinnacle of the upside move are around $ 0.44 and between $ 0.50 and $ 0.515.

The first stage gives wave A: C a ratio of 1: 1.27 (orange) and coincides with the 0.5 fib retracement resistance (black).

The second zone gives wave A: C a 1: 1.61 ratio and coincides with the 0.618 fib retracement resistance.

Daily DOGE / USDT Chart | Source: TradingView

Alternative scenario

The short-term volatility in the above scenario and the alternative scenario is the same, but the long-term performance will be different.

The difference is that instead of wave C, the sustained rise is part of the third wave of a bullish pulse. The number of partial waves is shown in black.

This means that DOGE will not turn around once the rally is over, but rather correct it at short notice before moving up further.

The shape of the running rally determines the correct movement. The closer DOGE is to $ 0.50, the more likely it is that this is the correct number.

Daily DOGE / USDT Chart | Source: TradingView

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