Dogecoin price analysis: A rally to $0.10 is possible
Dogecoin could extend its recovery to 10 cents
- Dogecoin price technical analysis: Weekly chart
- Dogecoin price technical analysis: Daily chart
- Dogecoin: Buy or sell this week?
The recovery in cryptocurrencies and renewed support by Tesla CEO Elon Musk have resulted in a sharp rally in Dogecoin in the past few days. In the week beginning 27 June 2022, the buyers are attempting to extend the relief rally above $0.08 for DOGE.
In an interview with Bloomberg at the Qatar Economic Forum, Musk said: “I intend to personally support Dogecoin because I just know a lot of people who are not that wealthy who have encouraged me to buy and support Dogecoin, so I’m responding to those people.”
However, a report by blockchain analytics firm Elliptic highlighted that Dogecoin is increasingly being used for various kinds of illicit activities.
“Dogecoin’s growing popularity means it has not escaped the notice of criminals,” said Elliptic.
“In addition to its use as a means of payment for legal goods and services, Elliptic has identified millions of dollars worth of Dogecoin transactions connected to illicit activity.
“While the vast majority of this activity consists of fraud, scams and ponzi schemes, it also includes the most serious types of crime, including terrorism financing and vendors of child sexual abuse material.”
Will the negative report stall Dogecoin’s recovery or could Dogecoin go up? Read the DOGE price analysis to find out.
Dogecoin price technical analysis: Weekly chart
The buyers built upon the momentum and started a recovery last week. DOGE’s price rallied 20.84% to finish the week at $0.07. The buyers will attempt to extend the recovery to the 20-week exponential moving average (EMA).
This level could act as a stiff resistance and if the price turns down from it, the bears will again try to pull the DOGE/USD pair to $0.05. A break and close below this support could signal the resumption of the downtrend.
Alternatively, if bulls push the price above the 20-week EMA, the rally could reach the downtrend line. The price has turned down from this resistance on three previous occasions, hence this is an important level to keep an eye on. A break and close above this level could signal a potential change in trend.
Dogecoin price technical analysis: Daily chart
The buyers pushed DOGE’s price above the 20-day EMA on 25 June. This was the first indication that the bears may be losing their grip. The bears defended the 50-day simple moving average (SMA) on 26 June but the bulls did not give up much ground.
The buyers are again attempting to push the price above the 50-day SMA. The 20-day EMA has flattened out and the relative strength index (RSI) is in the positive territory, indicating that the bulls have the upper hand.
If the price sustains above the 50-day SMA, the rally could extend to the psychological level of $0.10. The bullish momentum could pick up further if this resistance is taken out.
On the contrary, if the price turns down from the current level, it will suggest that bears are defending the 50-day SMA. The sellers will then try to pull the pair below the 20-day EMA. If they succeed, the pair could drop to $0.06.
Dogecoin: Buy or sell this week?
Dogecoin is attempting to rise above the 50-day SMA. If that happens, Dogecoin's price analysis suggests a rally to $0.10 is possible. On the other hand, if the price turns down from the current level, the bears will try to pull the pair below the 20-day EMA.
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.