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Despite bullish signals, the CVD showed that DOGE’s price might not hit $0.20 soon.
Traders are convinced that the coin will be profitable in the long term.
The price of Dogecoin (DOGE) increased by 6.21% over the past 24 hours, following a previous drop to $0.14. However, analyst Ali Martinez speculates that this might be only the beginning of a potential four-day long upward trend.
Based on Martinez’s analysis, the TD Sequential indicator on the daily chart signaled it was time to buy. This technical tool helps determine when a trend may be weakening or about to reverse.
Based on the information presented in the analyst’s chart, it appears that the sellers ran out of steam when DOGE reached a price of $0.14. Consequently, a rise or increase in price was expected to occur next.
DOGE Day came with good tidings
From a non-technical standpoint, AMBCrypto noted that the price surge for DOGE coin occurred on the 20th of April for reasons beyond just its technical aspects, which they referred to as “DOGE Day.”
Previously, we reported how Dogecoin could experience a price increase in the lead-up to the day.
Surprisingly, the day set aside by the project’s community to commemorate it became a “buy on rumor” occasion instead, noticeably affecting the price.
After a potential drop in trading volume as reported by Coinalyze’s Cumulative Volume Delta (CVD), will there be a “sell the news” reaction?
If this trend persists, it’s likely that sellers will match bids and pay the current price for DOGE coins, preventing it from reaching $0.20 in the near future.
If the CVD increases, though, some buyers may choose to withdraw their offers, while sellers could hesitate to participate. Consequently, the coin’s value could potentially keep climbing throughout the week.
An additional aspect AMBCrypto explored in their price analysis was evaluating it from an on-chain perspective. Initially, they examined the trading volume.
The price may slow down
Currently, Dogecoin has experienced a modest gain during the same timeframe in which its price surged. Yet, the upswing in trading volume may not have been sufficient to trigger a significant price breakthrough.
If DOGE‘s price reaches a plateau prior to the end of the current week, it’s possible. However, if the trading volume increases substantially along with the rising price, the bullish argument could be disproven instead.
Moreover, the total Funding Rate for Dogecoin reached 0.01%. This indicates that traders holding long positions are actually paying a premium to those with short positions, enabling them to maintain their bets in the market.
This suggests a positive outlook based on this indicator, but the Funding Rate may provide clues about the potential direction of price changes.
The rising price of DOGE along with substantial positive funding indicates that perpetual contract buyers have been acting aggressively by taking on large long positions.
Is your portfolio green? Check the DOGE Profit Calculator
It’s worth noting that these traders are currently benefiting from their investment in DOGE. In the immediate future, this situation is indicative of a bullish trend for the cryptocurrency. However, if funding levels decrease, the bullish outlook could be called into question.
But for now, DOGE seemed ready to rise higher than $0.16.
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2024-04-21 20:07