Dogecoin signals strong buy: Analysis behind

Amid a rut in all cryptocurrency tokens since the start of the New Year, DOGE price had dropped to $0.1411 on 10th January 2022. Since then, DOGE has been recovering. The price of Dogecoin (DOGE) today jumped over 20% as Elon Musk announced Tesla merchandise can be purchased with this crypto token.

Here’s the market structure of the coin.

Dogecoin is currently trading at $0.1916 levels, up by 11.5% and this bull run has come in regards to the announcement made by self-proclaimed dogfather Elon Musk. Investors trust the potential of the coin to climb up higher levels signalling strong buy for traders.

Looking at the daily chart, the coin rose to an early morning intraday high at $0.1956 levels. The early intraday low was seen at $0.1747 levels. On the daily chart, Dogecoin broke through the 23.6% FIB resistance level. Coming up against the $0.2000 resistance level, it made its intraday high soon after the announcement, the intraday high stands at $0.2150 levels.

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On a daily chart the strong buy region extends between $0.1815 and $0.1950 levels. Contrarily, the strong sell region was between $0.1975 and $0.2050 levels.

On an hourly chart the coin is seen consolidating between $0.1895 and $0.1935 levels. Dogecoin started the day with an intraday low at $0. levels before making a reverse.

Market Indicators

Hourly RSI: The hourly RSI is moving currently down towards 50 levels, showing mild price strength. The coin is more likely to trend high owing to pressure from investor’s side.

Fibonacci Retracement levels: 23.6%: $0.1603, 38.2%: $ 0.1707, 61.6%: $ 0.1876

Major support level: $0.1792

Major resistance level: $0.2150

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Conclusion

On the upside prices may move towards $0.2000 levels. The first major resistance sits at $0.1997 levels. In event of an extended rally upwards, the second major resistance sits at $0.2150 levels. Barring an extended crypto rally, the first major resistance is likely to cap the upside. On the downside a fall below $0.1750 levels, will bring the first major support level $0.1707 level in play.

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