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Dogecoin rebounds from recent lows with rising transaction volume and potential breakout signals.
Dogecoin (DOGE) has recently rebounded from recent lows, with growing speculation of potential near-term gains. Notably, Ali Martinez, a market analyst, identified key indicators suggesting a bullish momentum could be building.
#Dogecoin is gearing up for a bullish breakout! Watch for two key signals:
⭕️First, RSI breaking the descending trendline on the daily chart.
⭕️And second, $DOGE surging past the $0.11 resistance! pic.twitter.com/7i1QMXNi3F— Ali (@ali_charts) September 19, 2024
Key Signals Suggest a Bullish Momentum
According to Martinez’s analysis, two critical signals are emerging. The first is the Relative Strength Index (RSI), which shows a break above a descending trendline on the daily chart.
The second is the potential for DOGE to surpass the $0.11 resistance level. These observations align with Martinez’s chart, which highlights a descending wedge pattern, commonly viewed as a bullish formation.
The chart also displays key Fibonacci retracement levels, plotted between a high of approximately $0.22899 and a low of around $0.08049. DOGE is currently trading near the 78.6% Fibonacci level at $0.10067, which is currently acting as a support zone.
RSI Shows Positive Signals
Furthermore, the current RSI is hovering just above the 50 mark, indicating neither overbought nor oversold conditions. This position shows a neutral stance but hints at turning bullish.
The downward trendline in the RSI corresponds with resistance in price action, suggesting ongoing bearish momentum. However, the RSI’s attempt to break above this trendline signals a shift toward positive momentum.
Should Dogecoin achieve a breakout from the wedge pattern, a projected upward move of approximately 41.27% is anticipated. This would add around $0.04324 to the current price, aligning closely with the 38.2% Fibonacci retracement level, placed around $0.15.
Transaction Volume Surges, Bullish?
Adding to the optimism, Dogecoin recorded 1.93 million transactions last week, according to IntoTheBlock data. Surprisingly, this is the highest weekly transaction volume since early July helping the crypto to outperform others such as Shiba Inu.
An increase in transaction volume often signals renewed user engagement, suggesting heightened adoption or trading activity within the network. Despite this uptick, transaction counts remain below peak levels seen in February.
Previous price movements have also been influenced by notable industry figures such as X (formerly Twitter) owner Elon Musk. For instance, on September 7, Dogecoin saw an 8% surge when the billionaire investor humorously suggested that the “Department of Government Efficiency” adopt Dogecoin.