- Elon Musk pumps Dogecoin on Twitter, but the rally is short-lived.
- Technical indicators imply that the coin is ready for a bearish correction.
Dogecoin (DOGE) stormed into top-50 amid the FOMO triggered by Elon Musk's tweet. The message of Tesla's CEO contained only one word "DOGE"; however, that was enough for the coin's supporters to start buying it like there is no tomorrow.
DOGE gained over 30% in a matter of hours and touched $0.0055, the highest level since July 8, when the coin briefly reached $0.0056 before collapsing back below $0.004. At the time of writing, DOGE is changing hands at $0.0047. Despite the sell-off, the coin is still 12% higher on a day-to-day basis. The weekly gains exceeded 50%.
DOGE's market capitalization reached $627 million, while its average daily trading volume is registered at $689 million. The token is most actively traded at Binance, Huobi Global, and HBTC. This Litecoin fork was created in 2013 as a joke. However, the coin based he popular "doge" Internet meme quickly gained popularity. Now it is touted by numerous high-profile personas, including Elon Musk.
The correction is underway
A popular crypto Twitter analyst, aka IncomeSharks, warns his followers from investing in DOGE at this stage. He believes that the price is getting close to a strong resistance zone, and the sell-off risks are too high at this stage.
$DOGE - Be very careful with this one. Many will end up bagholding and taking a loss. Not worth the risk, 25 sats is where I'd sell if in it. pic.twitter.com/R2WKBNtA1b
— IncomeSharks (@IncomeSharks) December 21, 2020
Meanwhile, the technical indicators also paint a grave picture for DOGE. Thus, TD Sequential indicator sends a sell signal in the form of a green nine candlestick on the 4-hour chart. If the bearish formation is confirmed, DOGE may continue the correction for one to four red candlesticks with the first bearish target at $0.0044. This area stopped the recovery at the end of November and triggered the sell-off to $0.003.
DOGE, 4-hour chart
A sustainable move below $0.044 will open up the way to the next local barrier of $0.036 reinforced by 4-hour EMA50. The ultimate bearish target is $0.03.
Note: All information on this page is subject to change. The use of this website constitutes acceptance of our user agreement. Please read our privacy policy and legal disclaimer. Opinions expressed at FXstreet.com are those of the individual authors and do not necessarily represent the opinion of FXstreet.com or its management. Risk Disclosure: Trading foreign exchange on margin carries a high level of risk, and may not be suitable for all investors. The high degree of leverage can work against you as well as for you. Before deciding to invest in foreign exchange you should carefully consider your investment objectives, level of experience, and risk appetite. The possibility exists that you could sustain a loss of some or all of your initial investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with foreign exchange trading, and seek advice from an independent financial advisor if you have any doubts.
Recommended Content
Editors’ Picks
Ripple wipes out weekly gains, experts comment on role of Ripple stablecoin
Ripple declined to $0.52 on Thursday, erasing all gains registered earlier this week. Ripple SVP Eric van Miltenburg’s comments on the firm’s stablecoin, and how it is expected to benefit the XRP Ledger and native token XRP have raised concerns among crypto experts.
Hedera HBAR slips nearly 10% after air is cleared on mistaken link with giant BlackRock
HBAR price is down nearly 10% on Thursday, partly erasing gains inspired by the misinterpreted link with BlackRock. Despite the recent correction, Hedera’s price is up 44% in the past seven days.
The reason behind Bonk’s 105% rise and if you should buy now Premium
Bonk price has shot up 105% in the past five weeks. A retracement into $0.0000216 or the $0.0000152 to $0.0000186 imbalance would be a good buying opportunity. Patient investors can expect double-digit gains from BONK that could extend up to 70%.
Injective price weakness persists despite over 5.9 million INJ tokens burned
Injective price is trading with a bearish bias, stuck in the lower section of the market range. The bearish outlook abounds despite the network's deflationary efforts to pump the price. Coupled with broader market gloom, INJ token’s doomed days may not be over yet.
Bitcoin: BTC post-halving rally could be partially priced in Premium
Bitcoin (BTC) price briefly slipped below the $60,000 level for the last three days, attracting buyers in this area as the fourth BTC halving is due in a few hours. Is the halving priced in for Bitcoin? Or will the pioneer crypto note more gains in the coming days?