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This time, nobody's tweets have put Dogecoin back on traders’ radar, but rather its technical setup suggests a potentially explosive move. The meme token is trading at about $0.219 after weeks of consolidation, right at the intersection of crucial moving averages and support levels that could dictate its next significant move.
According to the chart, $DOGE has been maintaining its position above the rising trendline that began to gain traction in July. Every dip toward $0.21 has been greeted by buying pressure, despite multiple attempts to break lower. Because of this tenacity, bulls have remained optimistic that a breakout may be imminent.
The convergence of moving averages is supporting this story. Compaction of the 50-day, 100-day and 200-day EMAs is a classic indication of impending volatility. The asset has historically produced large moves, sometimes doubling in price in a matter of weeks, when $DOGE’s moving averages have lined up in this way.
At 48, the relative strength index (RSI) indicates that the market is neither overbought nor oversold. $DOGE has plenty of space to run in either direction, according to this neutral reading. The volume of daily trading has also been declining, which frequently comes before a breakout phase.
The token may spark a rally toward $0.28 and $0.30 if buyers push $DOGE above the resistance zone between $0.23 and $0.25. Psychological interest may also encourage attempts to retest $0.35, which were last observed in April.
A decline below $0.21, however, would refute this bullish thesis and expose $DOGE to additional declines toward $0.19 or even $0.17.
The next move could be sudden and dramatic because moving averages are tightening the grip on price action and sentiment is still cautious. Whether that leads to a disappointing breakdown or another classic $DOGE pump, volatility is all but certain.
As usual, meme coins present both opportunity and risk. Dogecoin’s chart indicates to traders who are keeping a close eye on things that a significant event may be imminent.