Dogecoin is slowly seeing a rebound. If this trend sustains, DOGE can reclaim the $0.10 mark soon.
- Dogecoin has shown signs of recovery after a recent dip, with analysts pointing to bullish reversal patterns. A potential MACD crossover and RSI suggested a possible surge in Dogecoin’s price.
Dogecoin [DOGE], the popular meme-based cryptocurrency, has seen a noticeable decline in its price over the past week, dropping by 5%.
However, the asset was showing signs of recovery, with a 1% increase in the past day, bringing its trading price to $0.1008 at the time of writing. This marked a significant rebound from the lows of $0.096 recorded earlier this week.
Technical outlook on Dogecoin
Amid these price movements, several crypto analysts have shared their insights on Dogecoin’s future price action.
Among them is the well-known crypto analyst Trader Tardigrade, who expressed a bullish outlook in a post on X (formerly Twitter).
He pointed out a potential bullish reversal for Dogecoin, highlighting a “Diamond Reversal Pattern” on the DOGE H4 chart.
According to Tardigrade, this pattern indicated that Dogecoin may have reached its bottom in the current downtrend.
A bullish crossover in the MACD (Moving Average Convergence Divergence) is likely to happen soon, which could signal a strong upward move for the asset.
Source: Trader Tardigrade/X
The Diamond Reversal Pattern is a technical analysis chart pattern that signals a potential reversal in a security’s price trend.
Typically, this pattern forms after a prolonged trend, either bullish or bearish, and resembles a diamond shape on the chart. The pattern begins with a widening price range that eventually narrows, forming a diamond.
A breakout from this pattern, usually in the opposite direction of the prior trend, indicates a potential reversal.
In the case of Dogecoin, the formation of this pattern suggests that the downtrend may be nearing its end, with a possible bullish reversal on the horizon.
Another crypto analyst known as dogegod on X has also provided a positive outlook on Dogecoin’s price action.
He noted that recent price movements have established a bottom for Dogecoin, and historically, bull runs for DOGE have commenced when the green and red lines on the chart intersect, leading to a price surge in the following weeks.
Source: dogegod/X
According to dogegod, this pattern could be expected to repeat in the current cycle, with a potential start as early as the first week of September.
He anticipated that the coming weeks could be predominantly bullish for Dogecoin, mirroring the previous cycles’ behavior after the critical intersection.
Fundamentals and market indicators
In addition to these technical patterns, Dogecoin’s fundamentals have also shown notable trends in recent months.
According to data from Santiment, the number of active Dogecoin addresses has seen a significant decline, dropping from 4.5 million active addresses in March to below 600,000 as of press time.
Source: Santiment
This reduction in active addresses could suggest a decrease in user activity and engagement, which might impact DOGE’s price negatively, if the trend continues.
Furthermore, data from CryptoQuant revealed that Dogecoin’s Relative Strength Index (RSI) was sitting at a neutral condition with a figure of 50 at press time.
Source: CryptoQuant
The RSI is a momentum oscillator used in technical analysis to measure the speed and change of price movements.
An RSI of 50 indicates that the asset is neither overbought nor oversold, suggesting that the market sentiment towards Dogecoin is balanced.
This neutral RSI could mean that Dogecoin is in a consolidation phase, where neither buyers nor sellers have a clear advantage, potentially leading to a period of sideways price movement before a more decisive trend emerges.
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