Trade Recommendation: Dogecoin
It wouldn’t be an altcoin season unless Dogecoin (DOGE/BTC) pumps. A look at the charts tells us that Dogecoin is about to make altcoin season official.
The market has been in bear territory after climbing as high as 0.0000011 on September 10, 2018. From that point, Dogecoin was trapped inside heavy correction. Those who bought early were dumping their positions heavily to retail traders who were buying due to the fear of missing out. As a result, the price plunged to as low as 0.00000044 on November 15 before any meaningful bounce.
By then, Dogecoin was a forgotten market. Almost no one in the crypto community was interested in taking on any trades relating to this coin. However, we believe that that’s about to change soon.
Technical analysis shows that DOGE/BTC is about to break out from a large symmetrical triangle on the daily chart. We have this view for a couple of reasons.
First, Dogecoin is respecting diagonal support of 0.0000005. This diagonal support is extraordinary because the market has kept it alive since the December 2017 bull run. A trendline that has existed for more than a year is a testament to its strength. Dogecoin is very likely to preserve it considering that the market has been in bear territory for over six months now. In other words, it is very unlikely that a big player will dump the market at current levels.
Second and more importantly, Dogecoin went on a parabolic run the last time it touched this support in August 2018. If the market continues to stay above this diagonal support, we expect Dogecoin to react the same way.
The strategy is to buy as close to 0.0000005 support as possible. If bulls can stay above this level, the market will likely rally to our targets of 0.0000007 and 0.00000095.
The process may take less than a month.
Daily Chart of Dogecoin/Bitcoin on Poloniex
As of this writing, the Dogecoin/Bitcoin pair is trading at 0.00000052 on Poloniex.
Summary of Strategy
Buy: As close to 0.0000005 as possible.
Targets: 0.0000007 and 0.00000095.
Disclaimer: The writer owns bitcoin, Ethereum and other cryptocurrencies. He holds investment positions in the coins, but does not engage in short-term or day-trading.
Featured image courtesy of Shutterstock.