Dogecoin price analysis 23 Dec: rally could be on horizon
Dogecoin is showing signs of a recovery as adoption grows
Elon Musk tweeted on 14 December that Tesla plans to “make some merch buyable with DOGE.” This announcement resulted in a sharp rally in the price of dogecoin. Musk has been one of the most vocal supporters of the meme coin in the past few months and his tweets usually rock the coin one way or the other.
In another positive development, the cryptocurrency payment processor Flexa announced on Twitter that it plans to add support for dogecoin, which could be used for payments at the US branches of GameStop.
Could dogecoin go up on these announcements, which may lead to greater adoption? Read the DOGE price analysis to find out.
Dogecoin price technical analysis: weekly chart
DOGE’s price has been trading inside a large range between $0.15 and $0.35 for a few months. The bulls have successfully defended the support of the range for the past three weeks but have not been able to sustain the rebound.
This indicates that the bears continue to sell on rallies. If the bulls fail to push the price above the 20-week exponential moving average (EMA) within the next few days, the possibility of a break below the $0.15 support increases.
If that happens, the DOGE/USD pair could witness aggressive selling and the decline could extend to the psychological level of $0.10. This is an important support for the bulls to defend because if it cracks, the next stop could be $0.06.
Contrary to this assumption, if the bulls drive and sustain the price above the 20-week EMA, the large range will come into play. The pair could then gradually rise to $0.35. The bears are likely to defend this level aggressively. A break and close above $0.35 could start a new uptrend.
Dogecoin price technical analysis: daily chart
DOGE’s price soared above the 20-day EMA on 14 December but the bulls could not clear the hurdle at the 50-day simple moving average (SMA). This may have attracted profit-booking from short-term traders.
The pair again slipped back below the 20-day EMA, indicating that bears have not yet given up. However, a minor positive is that bulls have not allowed the price to dip below $0.15. This suggests accumulation at lower levels.
The 20-day EMA is flattening out and the relative strength index (RSI) is attempting to rise into positive territory. This suggests that the selling pressure may be reducing.
The bulls are again attempting to push the price above the 20-day EMA. If they succeed, the pair could rise to the 50-day SMA. This level may act as a strong hurdle but if crossed, the rally could reach $0.27.
On the other hand, if the price turns down from the current level and breaks below $0.15, the pair could start a downtrend.
Dogecoin: Buy or sell this week?
Dogecoin’s price analysis shows that the bulls are trying to push the price above the 20-day EMA. If they succeed, it will suggest the start of a recovery, which could gain strength on a break and close above the 50-day SMA. This bullish view will invalidate if the price turns down and plunges below $0.15.
The views and opinions expressed in the article are those of the author and do not constitute trading advice. Trading and investing involve substantial risks and you should do your own research or contact your financial adviser before arriving at a decision.