Trade Recommendation: Dogecoin (DOGE)
Dogecoin (DOGE/BTC) is a market that looks ready to end its downtrend from the macro perspective.
In September 2018, the cryptocurrency climbed as high as 0.0000011. From that point, Dogecoin started its downward spiral. Recently, it recorded lows of 0.00000024 on June 26th. In eight months, the crypto token lost over 78% of its value.
The good news is that the long downtrend might be coming to its end. Dogecoin is printing a bullish pattern that can bring the market back to life.
Technical analysis shows that DOGE/BTC is creating large falling wedge on the weekly chart. This is a pattern that usually resolves in favor of the bulls. Looking at the weekly chart, the wedge is approaching its apex. Interestingly, the pattern’s apex is close to the coin’s key support area of 0.00000027. Thus, if bulls continue to hold 0.00000027, Dogecoin will likely break out of the pattern.
Also, technical indicators are flashing bullish signs. There’s a bullish divergence on the daily RSI. Plus, the weekly RSI is close to oversold levels. These signs indicate that bulls are starting to gain momentum. Lastly, there was a significant volume uptick on July 5th. This tells us that buyers have returned to bottom pick the market.
The strategy is to buy on the breakout and retest of 0.00000035 as support. If bulls can stay above this level, the market will likely rally to our target of 0.0000005.
The process may take less than a month.
Daily Chart of Dogecoin/Bitcoin on Poloniex
Summary of Strategy
Buy: Breakout and retest of 0.00000035 as support.
Stop: 0.00000033 after the breakout.
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.
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