Dogecoin: Two more roadblocks to 2023 highs
Disclaimer: The information presented does not constitute financial, investment, trading, or other types of advice and is solely the writer’s opinion.
- May’s range-high and a bearish OB were key hurdles to $0.1.
- Trading volumes surged >1 billion DOGE since April highs.
If you’re a memecoin enthusiast and trader, you might have noticed Dogecoin [DOGE] and Shiba Inu [SHIB] decoupling from the overall market direction. While the rest of the market sustained sell pressure amidst weak Bitcoin [BTC], DOGE and SHIB posted impressive gains in the last few days.
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In particular, DOGE maintained its recovery since mid-June, posting over 40% gains after rising from $0.053 to $0.079. But the memecoin faced two more roadblocks before hitting $0.1.
Bulls climbed above a key price level
Source: DOGE/USDT on TradingView
Dogecoin sustained losses in May and June amidst increased regulatory and macroeconomic uncertainty. But the May/June losses have been reversed after DOGE retested the May highs of $0.082.
Besides, the price action climbed above a critical price reaction zone of $0.0724 – $0.0763 (white) on the daily chart, reinforcing the bullish price action. The price zone was a key support in Q2 but was flipped to resistance in May. But it was flipped to support on 25 July, reinforcing bulls’ leverage.
However, the previous May range-high ($0.082) and the D1 bearish order block (OB) of $0.0897 – $0.0950 (red) are crucial overhead roadblocks. Bulls must clear them to confirm extra bullish intent to cross $0.1 and retest 2023 highs.
Given the confluence of the price reaction zone and the trendline support, any breach below the area ($0.073) will dent the bullish bias. The immediate lower support will be $0.070 if price action breaches the confluence area.
Despite the massive buying pressure, as shown by the Relative Strength Index at 61 at the time of writing, capital inflows stagnated, as demonstrated by Chaikin Money Flow wavering near zero mark.
How much are 1,10,100 DOGEs worth today?
DOGE hit a new Q3 trading volume high
Source: Santiment
On-chain metrics indicated massive accumulation and holding, as shown by the rising 90-day Mean Coin Age. Besides, trading volumes crossed over 1 billion DOGE on 25 July, for the first time since April, amidst increased demand. The overall weighted sentiment also improved but was yet to flip positive.
So, the confluence area of the price reaction zone and the trendline support will be a crucial interest for late bulls, especially if BTC doesn’t record more losses.
