Dogecoin (DOGE) reached a high of 61 satoshis on Jan 13, 2019. Its price has been gradually decreasing. On Feb 21, DOGE reached a low of under 50 satoshis.
Between Feb 21 and Mar 28, DOGE experienced general volatility with prices fluctuating between 49 and 55 satoshis. The 49 low was reached three more times following Feb 21.
Will DOGE maintain this neutral pattern or should we expect greater volatility?
Keep reading to find out.
Today’s analysis suggests that price is likely to continue to decrease at the rate predicted by the long-term channel. It is not likely that January’s high will be reached again in the near-term.
Dogecoin (DOGE): Trends And Highlights For March 28, 2019
- DOGE/BTC has been on a downtrend since Jan 13.
- Dogecoin is trading inside a descending channel.
- There is bullish divergence developing in the RSI.
- There is resistance near 65 satoshis.
- There is support near 45 satoshis.
Descending Channel
The price of Dogecoin on Bittrex is analyzed at six-hour intervals from Jan 12 to Mar 28
On Jan 13, the price made a high of 61 satoshis before closing at 59 satoshis.
It has been on a gradual downtrend since, creating several lower highs. Tracing these highs gives us a descending resistance line:
On Feb 11, the price made a low of 51 satoshis. Since then, it has made several lower lows. Tracing these lows gives us a descending support line.
Together, the support and resistance trace a descending channel:
Price is expected to fluctuate within this channel with successively lower highs and lows over time. This means that Dogecoin should experience long-term losses despite any short-term gains.
Currently, DOGE/BTC is near the resistance line. This means that a drop toward 50 satoshis is possible. Based on the channel alone, Dogecoin may cross below 48 satoshis by the beginning of April.
Bullish Divergence
To better assess possible future price fluctuations, we incorporate the relative strength index (RSI) into the analysis.
Aboust RSI: The relative strength index (RSI) is an indicator which calculates the size of the changes in price in order to determine oversold or overbought conditions in the market. Combining RSI bullish/bearish divergence with support/resistance essentially predicts price fluctuations.
On Feb 11, the price reached a low of 51 satoshis. It has continued to make lower lows since.
During the same interval, the RSI reached a low on Feb 11. However, it has generated higher values since.
This is known as bullish divergence and often precedes price increases. Such increases occurred with highs of 56 satoshis experienced before the end of Feb.
Price has since been following the rate of decline predicted by the descending channel. While a breakout is possible, it does not currenlty appear likely. Dogecoin is more likely to continue tradng within its current trading pattern.
Reversal Areas
The price of Dogecoin on Bittrex is analyzed at six-hour intervals from Oct 25, 2018 to Mar 28, 2019 in order to better visualize possible reversal areas.
About Resistance and Support Areas: Resistance and support areas are formed when the price reaches a certain level several times. They help to assess possible future values based on past trends.
The closest support area is found near 45 satoshis. If the price keeps decreasing at the rate predicted by the channel, it is likely that it will eventually reach this level.
Summary Of Analysis
Based on this analysis, it is likely that the price of DOGE trades inside the confines of the descending channel with gradual price decreases over time. If a breakout occurs, the trend may be reversed.
When do you think the price of DOGE will make a decisive move? Let us know your thoughts in the comments below.
Disclaimer: This article is not trading advice and should not be construed as such. Always consult a trained financial professional before investing in cryptocurrencies, as the market is particularly volatile.