Dogecoin Price Rises Past Key Resistance Following DOGE Day Anniversary

Key Takeaways

• Dogecoin soared to $0.16 just a day after DOGE Day celebrations, breaking out of a months-long downtrend.
• DOGE has broken out of a descending channel, a structure often followed by sharp bullish moves when breached.
• The Parabolic SAR dots have flipped below the price — a bullish sign, indicating that the memecoin could close in on $0.25.

Dogecoin (DOGE), the eighth most valuable cryptocurrency by market cap, surged to $0.16 today. This comes just a day after DOGE Day, an annual celebration of the memecoin.

DOGE Day, which first gained popularity during the 2021 bull run, coincides with April 20, also known as International Cannabis Day. This year marks the fourth edition of the celebration.

Following the development, DOGE has broken out of a bearish pattern it had been trapped in for months. But will the value of memecoin continue to increase? 

DOGE Day Fuels Demand

Before the recent rise, Dogecoin’s price had traded within a descending channel. This decline resulted in a 52.90% decline in the memecoin’s market value.

A descending channel forms as a cryptocurrency’s price keeps sliding down. It can signal a continuation of a bearish trend or a possible bullish reversal if broken to the upside.

Here, the upper trendline connects the lower highs, acting as resistance. On the other hand, the lower trendline connects the lower lows, acting as support.

On the daily DOGE/USD chart, the memecoin’s price has broken above the upper trendline of the falling channel. According to CCN’s findings, the bullish sentiment around DOGE Day led to higher demand for cryptocurrency.

The Money Flow Index (MFI) also reflected this bias. As seen below, the MFI reading has risen above the signal line.

The MFI reading at 71.71 indicates buying pressure around the coin. If this pressure remains the same, DOGE’s price could climb higher in the short term, with support at $0.14.

Price-Volume Trend Aligns

Furthermore, on-chain data from Santiment shows a hike in DOGE’s volume. During the early trading hours on DOGE Day, the memecoin’s volume was less than $500 million.

As of this writing, the figure has risen to $867.83 million. Typically, rising volume alongside increasing price is bullish, while falling volume indicates otherwise.

Therefore, if sustained, the rise in the cryptocurrency’s volume could push Dogecoin’s price higher than $0.16.

Regarding the cryptocurrency’s price action, pseudonymous analyst Rekt Capital opined that DOGE’s price could continue trading higher if sellers remain exhausted.

“The retest is in progress, and if the sellers demonstrate that they are exhausted, it will be easier for buyers to move price to the upside once that buyer volume comes in at support,” The analyst stated in his newsletter.

DOGE Price Forecast: Bullish Continuation in Motion

With DOGE’s price testing the upper trendline of the falling channel, CCN observed that the dots of the Parabolic Stop And Reverse (SAR) indicator have dropped below the price.

The drop below the price indicates strong support near $0.014. Beyond that, the Awesome Oscillator (AO) reading has flashed green histogram bars, suggesting that Dogecoin could switch from bearish to bullish momentum.

Should the trend continue, DOGE’s market value could hit $0.18 in the short term. In a highly bullish market condition, the memecoin’s price might rally to $0.25 at the 0.618 Fibonacci level.

However, another downturn could be next if Dogecoin faces rejection before it hits $0.18. In that scenario, the price could drop to $0.10.