Dogecoin Price Analysis: DOGE Sideways Trading Prevails, But for How Long?
- Dogecoin’s uptrend runs into resistance at the 100 SMA on the four-hour chart.
- The transaction history model shines a light on the immense seller congestion zone between $0.32 and $0.33.
Dogecoin championed a massive recovery on Monday after securing support at $0.3. The bullish outlook targeted an upswing to $0.4, but bulls did not make it past $0.33. The 100 SMA strengthened this resistance, forcing DOGE on another minor retreat.
At the time of writing, Dogecoin trades at $0.32 while holding at the 50 SMA on the four-hour chart. Note that short-term technical indicators point toward a sideways price action taking precedence in the near term.
Dogecoin caught up in the tug of war between bulls and bears
The indecision in the market is evident based on short-term technical indicators such as the Moving Average Convergence Divergence (MACD). An uptrend from the recent dip to -0.013 appears to have stalled at the zero line. The MACD line (blue) and the signal line have no defined direction apart from the leveling motion; thus, emphasizing the prevailing consolidation.
DOGE/USD four-hour chart
The Bollinger Bands on the four-hour chart affirm Dogecoin’s consolidation. Holding above the middle curve will ensure that bulls remain relatively in control. However, more constriction is required before a breakout comes into the picture.
Realize that the Bollinger Bands do not point out the direction of breakout and the distance between the lower and the upper and is mainly a no-trade zone. Therefore, traders are required to watch for a four-hour close above or below this area to determine the direction of the trend.
DOGE/USD four-hour chart
Looking at the other side of the fence
The IOMAP model shows that Dogecoin’s recovery will not come quickly based on the resistance between $0.324 and $0.334. Here, 40,000 addresses previously bought nearly 9.4 billion DOGE. Thus, the seller congestion in this zone seems robust enough to delay the bullish trend from extending to $0.4.
Dogecoin IOMAP model
On the flip side, Dogecoin sits in an area with a relatively small congestion of buyers. This region runs from $0.314 to $0.323 and hosts the 112,900 addresses that are currently profiting from 4.5 billion Dogecoin previously purchased. A spike in selling pressure will most likely crack through this support thus, paving the way for losses under $0.3.