Bitcoin has recently bounced back to the $49,300 mark, signaling a short-term recovery that could suggest a more optimistic trend. This resurgence is largely driven by a notable increase in spot purchases. Although it’s premature to conclude the end of the market’s slump, the signs are looking up as the daily trade closure looms. In light of this, the focus shifts to Dogecoin and its potential trajectory.
Tracking Dogecoin’s Path
Dogecoin’s trajectory has been characterized by a steady climb within a defined upward channel. Observing the pattern since June 2023, the cryptocurrency experienced a significant breakout in December, reaching $0.107. However, following a dip in January, Dogecoin’s value has re-entered the channel, consistently testing and confirming the resistance level, while maintaining a lateral movement above the channel’s median—that could hint towards an upcoming uptick.
Future Prospects for DOGE
Daily chart indicators like the RSI are showing positive signs for Dogecoin, indicating potential for price appreciation. This outlook is bolstered by the wider market’s momentum, reflected in Bitcoin’s recovery post-inflation data release. A more granular look at the six-hour chart predicts that the upward trend for Dogecoin is likely to persist, as evidenced by its ability to convert a descending resistance line into support on February 9th, further validated four days later.
While Dogecoin’s recent uptick is backed by an RSI shift into the neutral zone, it faces a noteworthy challenge at the resistance trend line of the channel near $0.088. Should Dogecoin manage to breach this level, the price could surge by 25% to reach $0.102. Conversely, if Bitcoin undergoes a sharp correction and Dogecoin sellers take charge, falling below $0.078 might pave the path to newer lows with strong support seen at $0.066 and below that, around $0.050.
Notably, the absence of significant Dogecoin-specific news and Elon Musk’s waning influence in the crypto community after severing ties with the market, removes a potential catalyst for price support. Previously, Musk’s engagement, coupled with payment service licenses procured by his ventures, had the potential to affect Dogecoin’s valuation positively.