The contraction in Dogecoin channel has limited the price movement from 46.6 satoshis to 48.3 satoshis – much narrower than the previous range of 46.6-50 satoshis. I had discussed the possibility of the consolidation extending earlier because neither of the parties is willing to exert force.
The current value of each Dogecoin is 47.9 satoshis.
Image: https://www.tradingview.com/x/AaEkPQjp/
Analysis of the 240-minute Dogecoin/Bitcoin price chart supports my earlier view that the consolidation may prolong.
Bollinger Bands – The latest price contraction has witnessed Bollinger Bands playing a crucial technical role. As is evident from the chart above, Dogecoin is being floated by the lower range of the BB while the upside has been capped by the 20-4h simple moving average. The current 20-4h SMA is 48.4 satoshis while the lower range is at 47.2 satoshis.
Relative Strength Index – The RSI indicator is as inactive as the underlying cryptocurrency. With a reading of 48.0162, it offers no useful insights into the future course of price action.
Chart Structure – One very interesting observation is that the cryptocurrency has managed to hold its ground near 46.6 satoshis while the upmoves have been gradually suppressed to lower tops. Since a breakout is imminent, it would be interesting to see if the floor caves or the roof is taken out.
Market participants are advised to remain patient as a major move is anticipated in Dogecoin by the end of the week. Market exposure should be limited to light positions only. Long positions should be avoided as the major trend is still bearish and any substantial rise up to 50 satoshis should be used to build short positions in the counter. I am expecting a breakdown in the next 72 hours with the support of 43 satoshis being retested. Volatility may see a spike in the coming sessions, so staying alert will be of paramount importance.
