Has crypto analyst Balo (@btcbalo). is highlighted A major technical breakout on the Dogecoin (DOGE/USD) chart that indicates an uptrend in the near future. Ballou's analysis, based on a 4-hour chart, points to several key technical developments that create expectations for continued upward movement in the price of Dogecoin.
Why Does Dogecoin Look Like It's Poised To Climb?
The cornerstone of Ballou's assessment focuses on Dogecoin's decisive break from a long-term downtrend line on December 28. This downtrend line, originally established from the December 8 high of $0.48, served as an excellent resistance level and virtually dictated DOGE's price movements in December.
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A break above this trend line indicates a critical turning point. After this rally, Dogecoin experienced a minor correction where memecoin quickly retested the broken trend line. However, the retest was successful and strengthened Dogecoin's bullish outlook.
Complete failure of downward trend The dissolution line is a descending triangle pattern that was formed on December 21st. A descending triangle is characterized by a series of lower highs that converge on a relatively flat support level, often indicating a potential bearish continuation.
However, Dogecoin's ability to break out of this formation today, on January 2, indicates a shift in market sentiment. The breakout from the descending triangle, along with the breakout, reinforces the bullish narrative, although a retest of the upper boundary of the triangle could provide further credence to the bullish trend.
Integral to Ballou's thesis on a major breakout is also the volume profile, which provides an accurate understanding of trading activity at various price levels. Dogecoin bounced back from significant support in the highest volume cluster around $0.32, indicating a strong base of Accumulated trading profit
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On the upside, volume is thin until the $0.40 area, where there is a large cluster up to $0.43. This clustering suggests that above this zone, DOGE could face minimal resistance, paving the way for Dogecoin to target its yearly high of $0.4834 recorded on December 8.
Further reinforcing the bullish outlook is the completion of the ABC pattern on the Dogecoin chart. The ABC pattern is a correction sequence in technical analysis that usually indicates the end of the correction phase and the continuation of the previous trend. In the case of Dogecoin, the finalization of this pattern is seamlessly aligned with the other pattern Bullish indicators Derived from volume and fracture profile analysis.
Therefore, Ballou's statement “DOGE (is starting to break out), I see no reason to stop now. New highs soon, could indicate that DOGE is headed for a new high.”
At press time, DOGE was trading at $0.34.
Featured image created with DALL.E, chart from TradingView.com
