Dogecoin has created what appears to be a ‘double bottom formation’ with both lows at $0.37 and a resistance at $0.47.
A breakout above the neckline at $0.47 may push the price up again to $0.55 and $0.60.
Traders are encouraged to pay special attention to volume and a continued follow-through to ensure against fake outs.
The double bottom chart pattern has explained various patterns seen in the market, including the formation of Dogecoin, the newest and most widely used cryptocurrency. This pattern with two similar lows and resistance line at the neckline is considered by most analysts as a buy signal.
Double Bottom Pattern and Key Resistance Levels Explained
The double bottom is a famous technical chart pattern which points at the reversal of a downtrend. In the case of Dogecoin, this pattern is visible on the 8-hour chart of the asset where two distinct lows were created at the $0.37 price point. The neckline, which can be referred to as the resistance level, has been located at $0.47. What has been observed is that when the price of an asset breaks above this neckline it is considered an indication that a rally by the buyers is on the way.
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The neckline at $0.47 is the kind of resistance level that must be breached by Dogecoin in order to validate the double bottom pattern. A continuous pull over this level may result in more added buying pressure and the subsequent targets seen at $0.55 and $0.60. These levels may be possible areas where traders could seek to enter to try and ride in a higher direction.
Market Outlook and Implications
The appearance of the double bottom pattern involves bigger attention on the part of market participants since this figure is considered reliable for determining reversal points. E.g. if the neckline resistance is breached, then, there may be a reawakening to the asset as they draw a new round of trading volume. It may also extend to all other altcoins since fluctuations in Dogecoin’s price movement are generally indicative of shifts within the crypto industry.
Although this pattern has given a signal of an upward movement, traders are advised to be cautious. Today’s focus is on Dogecoin as it approaches the neckline resistance, hence the next five days will determine its outcome. Any breakout should then open up an uptrend while a failure to hold such levels might result in further consolidation.
The post $0.47 Resistance in Focus as Dogecoin Forms Classic Double Bottom Chart Pattern appeared first on Crypto News Land.
