Dogecoin price needs to retrace for DOGE to rally another 30%
|- Dogecoin price might retrace before the next leg-up as MRI flashes a sell signal.
- An 8% retracement to the demand zone’s upper limit at $0.311 seems likely.
- A resurgence of buying pressure around $0.311 could propel DOGE up by roughly 28% to $0.40.
Dogecoin price rallied exponentially over the past 24 hours, slicing through a crucial supply zone and flipping it into support. This move, while bullish, needs to retest the newly formed demand barrier to confirm the presence of buyers.
If successful, DOGE might soon kick-start a new uptrend, coming close to its pre-May 19 crash levels.
Dogecoin price prepares for a pullback
Dogecoin price rallied roughly 22% over the last 24 hours, shattering the immediate supply zone extending from $0.28 to $0.31. A correction here is likely due to the extended nature of the upswing and the sell signal flashed by the Momentum Reversal Indicator (MRI) in the form of a red ‘one’ candlestick.
This technical formation forecasts a one-to-four candlestick correction, hinting at a retracement to the immediate support level at $0.33. An increased number of investors booking profit could lead to a breakdown of $0.33 and a retest of $0.31, the demand zone’s upper limit.
Investors can expect a resurgence of buyers at $0.31 or $0.33, leading to the start of a new uptrend.
The resulting bullish momentum will likely breach $0.37 and make a run at the $0.40 resistance barrier.
DOGE/USDT 9-hour chart
On the other hand, if the retracement continues to head lower, breaching $0.31, DOGE will reenter the demand zone ranging from $0.28 to $0.31. While a consolidation within the range mentioned would only delay the upswing, a decisive 9-hour candlestick close below $0.28 will invalidate the bullish thesis.
In such a case, market participants can expect the meme coin to retest $0.27.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.