Dogecoin Price Technical Analysis for 12/03/2015: Sellers Ready!
Dogecoin price continued to consolidate around 48 to 49 satoshis on Hitbtc in the past couple of days, as the lack of a fresh market catalyst kept ranges intact. Trading activity has been subdued in cryptocurrency pairs towards the end of the week, with market participants booking profits off current dogecoin price levels.
Looking at the 1-hour chart of DOGE/BTC from tradingview.com shows that technical indicators are hinting at further consolidation for the meantime:
- 100 and 20 exponential moving averages are treading sideways and moving closer, confirming range-bound movement between support at 48 satoshis and resistance around 49 satoshis.
- Shorter-term EMA is moving below the longer-term EMA, indicating the possibility of a downside break and potential declines in dogecoin price levels.
- Stochastic is on middle ground as it is moving between the 40 and 60 levels but is pointing downwards, also confirming a potential buildup in selling momentum. The indicator has just left the overbought area and is on its way south, which means that price could move lower too.
- If stochastic moves below the 40 level and makes its way towards the oversold region, DOGE/BTC could drop below the current range support and decline until the move is overdone.
A break lower could mean a move towards the next support level at 44 satoshis for DOGE/BTC. Increased selling pressure and higher bitcoin price levels could mean a move towards 42 satoshis in the near term.
The exponential moving averages could continue to hold as short-term resistance for dogecoin price for now, as these have served as dynamic inflection points in the past.
- Note how price has pulled up to the green moving average (100 EMA) or longer-term inflection point, which has held as resistance in the ongoing downtrend.
- The shorter-term moving average in red (20 SMA) has been trading close to the price, which confirms that consolidation could carry on until strong catalysts for a breakout are seen.
- Volatile moves are usually seen at the start of the week as news reports come in, with the possibility of consolidation taking place towards the end of the trading week.
A previous article analyzing the 4-hour chart of DOGE/BTC shows that a longer-term downtrend is underway, with dogecoin price previously testing support at 40 satoshis.
- Note that price has been dropping since the start of this month, as traders have exchanged their dogecoin holdings for bitcoin.
- Positive developments in the latter cryptocurrency have drawn more demand, with more online merchants accepting bitcoin transactions on their platforms and more exchanges acknowledging the trading potential of BTC.
- On the other hand, an upside break past the short-term resistance at 40 satoshis could lead to a move towards the 50 satoshis dogecoin price level, which might serve as an area of interest and psychological resistance point.
- Further gains past the next resistance point could lead to a test of the 52 satoshis level, which has held as resistance earlier in the month.
Conclusion:
Tight consolidation is taking place for dogecoin at the moment but a potential breakout is looming, with technical indicators and long-term trend behavior suggesting a downside move.
Chart from Hitbtc