After bouncing off from the trendline support near 32.7 satoshis, Dogecoin has quickly marched towards the resistance of the trading range, which comes at around 41.3 satoshis. Since the major trend is still bearish, it is advised that market participants short the virtual currency as it nears the resistance level.
Dogecoin has surged more than 16 percent to 40.7 satoshis since yesterday.
Technical analysis of the 240-minute Dogecoin/Bitcoin price chart has been presented here.
Dogecoin Chart Structure – I had discussed in my previous analysis that hope is fading away for the bulls since Dogecoin is consistently touching fresh year-to-date lows; recently, it had dropped to 32.7 satoshis to register a fresh 2015-low. But now, as this range becomes clear, bears seem to be covering their shorts near the lower level of the range while creating fresh bearish positions near the higher level. At the current level, Dogecoin is very close to the resistance zone.
Bollinger Bands – It can be seen in the chart above that Dogecoin is trading above the 20-4h simple moving average of 38.7 satoshis. However, sustaining above this key technical level remains a monumental task for the virtual currency.
Relative Strength Index – The strength indicator has recorded a massive jump in the reading; the latest RSI value is 53.4016 while yesterday’s level was 34.0821. A reading above 50 suggests that more gain may follow, however, in this bear market, maintaining the strength level above 50 will require strong efforts from the bulls rather than just covering of the short positions.
The market has offered yet another opportunity to short Dogecoin and make some good profits at less risk. Short-term traders can create fresh bearish positions by maintaining a stop-loss just north of 41.3 satoshis for a target of 35 satoshis. The current market price turns the risk/reward ratio highly in favor of the market participant.
Dogecoin has surged more than 16 percent to 40.7 satoshis since yesterday. Technical analysis of the 240-minute Dogecoin/Bitcoin price chart has been presented here.