KEY OBSERVATIONS:
1. Price and Moving Averages: The current price of 0.40962 is slightly below the 60-period moving average (MA60) at 0.41125, indicating minor bearish pressure. The price recently bounced after a low of 0.27575, suggesting potential support.
2. MACD:
The MACD is flat with almost no histogram movement (very close to zero), indicating weak momentum and low volatility, which can signal a consolidation phase.
3. VOLUME:
There is a noticeable spike in volume but not accompanied by significant price movement, which could mean indecision or potential accumulation.
TRADING STRATEGY:
Considering the above, let’s outline both long and short trading setups with entry, exit points, and stop losses.
"LONG ENTRY SETUP "
1. Entry Point: Look for a breakout above the recent high at 0.42200, which is the 24-hour high. A confirmed breakout with volume above the resistance level could indicate a bullish move.
2. Stop Loss: Set a stop loss just below the 60-period moving average at around 0.40500 to protect against a sudden drop.
3. Take Profit:
TP1: 0.45000 (first resistance zone).
TP2: 0.48000 if momentum is strong and there is continued buying pressure.
4. Contingency Plans:
Plan B: If price dips below 0.40500, re-evaluate to see if it finds support at 0.40000.
Plan C: If price falls below 0.39000, consider switching to a short position.
"SHORT ENTRY SETUP "
1. Entry Point: Look for a break below 0.40000, which would confirm bearish momentum. Ensure volume increases on the downside to validate the move.
2. Stop Loss: Place a stop loss above the 60-period MA around 0.41200 to avoid quick fake-outs.
3. Take Profit:
TP1: 0.38000.
TP2: 0.35000 if the bearish momentum accelerates.
4. Contingency Plans:
Plan B: If price bounces back above 0.41200, close the short position to avoid losses.
Plan C: Monitor support around 0.37000; if it breaks, consider a larger bearish trend formation.
FINAL TIPS!!!
Volume Confirmation: Always confirm breakouts or breakdowns with volume, as this adds strength to the price movement.
Watch MACD: A sudden expansion in the MACD histogram can provide early signs of momentum shifts.
This setup provides flexibility based on market movements and lets you adapt to changes with defined stop losses and profit targets. Adjust based on real-time price actions and news affecting DOGE.
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