Dogecoin Breaks Downtrend, Eyes Key Resistance at $0.12
Key Takeaways
- Dogecoin (DOGE) has broken a six-month downtrend and is approaching a critical resistance level at 0.12 USD.
- A breakout above 0.12 USD could trigger a strong rally towards 0.20 USD.
- Technical indicators such as the Relative Strength Index (RSI) and the Moving Average Convergence Divergence (MACD) suggest a potential bullish move.
- On-chain data shows increasing network activity and potential accumulation of DOGE.
Dogecoin Breaks Downtrend: Rally Ahead?
Dogecoin (DOGE) has finally broken its six-month downtrend, sparking renewed hopes for an upcoming price rally. At the time of writing, the price stood at 0.1025 USD, reflecting a 5.37% increase over the past seven days. Despite a slight decline of 2.88% in the last 24 hours, traders remain focused on the resistance level at 0.12 USD.
With a market capitalization of just under 15 billion USD and a 24-hour trading volume of 553 million USD, DOGE is at a critical juncture. Technical patterns such as the falling wedge and inverse head-and-shoulders formation suggest a potential bullish reversal. A breakout above the 0.12 USD mark could pave the way for a stronger upward move.
Key Support and Resistance Levels
Currently, the crucial support for Dogecoin lies at 0.1050 USD, while resistance is being tested at 0.1200 USD. Should DOGE surpass the 0.1200 USD mark, it could signal a significant shift in market sentiment towards a bullish trend. A sustained rise above this level could push DOGE towards 0.20 USD.
However, Dogecoin must also maintain the support level at 0.1050 USD to sustain the current uptrend. A drop below this level could lead to further price declines, pushing it into a consolidation phase.
Technical Indicators: Mixed Signals
The technical indicators for Dogecoin are currently delivering mixed signals. The Relative Strength Index (RSI) stands at 47.45, indicating a neutral market environment. However, if the RSI rises above 50, it could suggest renewed bullish momentum.
The Moving Average Convergence Divergence (MACD) is on the verge of a bullish crossover, although the signal remains weak for now. A breakout above the 0.1200 USD resistance could confirm the MACD signal and bring additional upward momentum.
On-Chain Data Shows Growing Interest
On-chain data from IntoTheBlock shows increasing network activity for Dogecoin, which could support the current price trend. On September 15, Dogecoin registered 74,830 addresses, with 12,480 new addresses added that day. The number of active addresses was 44,870, indicating increasing participation in the network.
Additionally, 349,100 transactions were conducted, with the 7-day average standing at 275,660 transactions. The highest transaction volume of the past week occurred on September 13, with 461,370 transactions. This consistent activity suggests that interest in Dogecoin remains stable despite price fluctuations.
Notably, Dogecoin recorded a net outflow of 2.49 million DOGE from aggregated exchanges, indicating potential accumulation. Over the last 24 hours, the outflow amounted to 14.56 million DOGE, while the 7-day net flow showed an inflow of 12.24 million DOGE.
Our Take
Dogecoin is at a pivotal moment. The break of the six-month downtrend and the approach to resistance at 0.12 USD could trigger a strong price rally if technical indicators and on-chain data continue to send positive signals. Traders should closely monitor the next trading sessions, as they could be crucial for DOGE’s short-term price action.
A breakout above 0.12 USD could pave the way for a move towards 0.20 USD, while a drop below 0.1050 USD could jeopardize the upward trend.
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