The Dogecoin (DOGE) price broke out from a long-term descending resistance line. The wave count supports the continuation of the upward movement.
The DOGE price has increased since Dec. 30 and broke out from a descending resistance line on Jan. 2. Previously, the line had been in place since the beginning of Nov. 2021. As a result, the breakout from it can lead to a sustained rally. The ongoing upward movement caused Dogecoin to become the ninth-biggest digital asset in the cryptocurrency market based on its market cap.
If the upward movement continues, the closest resistance would be at an average price $0.098, which is the 0.382 Fib retracement resistance level of the entire downward trend.
Dogecoin Breaks out From Channel
The technical analysis from the short-term six-hour chart aligns with the daily time frame readings. The Dogecoin price upward movement caused a breakout from an ascending parallel channel. This is often a sign that the increase is impulsive.
While the 0.618 Fib retracement resistance rejected the Dogecoin price, it is now validating the channel as support (green icon).
On the other hand, a breakdown from the channel would indicate that the movement was corrective, and new lows will follow for the meme coin.
Why Upward Movement Will Continue for Dogecoin
The Dogecoin short-term price prediction suggests that the DOGE price is in sub-wave four of a five-wave upward movement (black). If the count is correct, it would mean that the Dogecoin price will consolidate before eventually completing sub-wave five.
A potential target for the movement’s top is between $0.100-$0.106. The target is created by wave one’s 3.61-4.21 Fib extensions (black). It is also very close to the long-term 0.382 Fib level from the previous section.
As for the long-term Dogecoin count, it is not certain if the increase is part of a long-term wave one or wave A (white). While the first one could eventually lead to a new all-time high, the second indicates that this is a corrective rally. In any case, both counts suggest that the trend is bullish in the short-term.
A decrease below the sub-wave one high (red line) at $0.075 would invalidate this bullish DOGE price analysis.
To conclude, the Dogecoin short-term price prediction is bullish. The price is nearing the end of its corrective wave. After this, an increase toward $0.100 would be the most likely scenario. A drop below $0.075 would invalidate this bullish DOGE price analysis.
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