As Dogecoin Fights This Bellwether Indicator Here’s A Look At What’s Next – Dogecoin (DOGE/USD)

Dogecoin: DOGE/USD was sliding over 5% lower during Monday’s 24-hour trading session, desperately trying to hold above the 200-day simple moving average (SMA) on the daily chart, which the crypto regained following news that Elon Musk’s Twitter: acquisition would close.

The bears briefly dropped the crypto below the important level on Monday afternoon, but the bulls came in and bought the dip.

The 200-day SMA is an important bellwether. Technical traders and investors consider a stock trading above the level on the daily chart to be in a bull cycle, whereas a stock trading below the 200-day SMA is considered to be in a bear cycle.

The 50-day SMA also plays an important role in technical analysis, especially when paired with the 200-day. When the 50-day SMA crosses below the 200-day SMA, a death cross occurs, whereas when the 50-day SMA crosses above the 200-day, a bullish golden cross takes place.

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The Dogecoin Chart: A stock or crypto is unlikely to bust up through or break down under the 200-day SMA on the first try, but the more times the area is tested, the weaker it becomes. Bullish traders will want to see Dogecoin close above the level, with a lower wick, which could indicate a bounce is on the horizon for Tuesday.

  • If Dogecoin closes below the 200-day SMA, the stock will also print a bearish Marubozu candlestick, which could indicate lower prices are on the horizon. If that happens, the 200-day SMA is likely to act as heavy resistance on the next bounce.
  • A golden cross formed on Dogecoin’s chart on Nov. 11, which indicated a bull cycle could be on the horizon. If Dogecoin falls below the 200-day SMA, a death cross is likely to eventually form, which could indicate a bear cycle is in play.
  • Dogecoin has resistance above at $0.075 and $0.083 and support below at $0.065 and at 6 cents.

See also: Bitcoin, Ethereum Investors Are Losing Money At A Historic Pace

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