Dogecoin bounced back, return of memecoins? Crypto Analysis for February 28, 2024

Dogecoin started a new week at over 17%. Let’s take a look at the future outlook for the DOGE price.

Status of Dogecoin (DOGE)

After failing to breach resistance at $0.10, Dogecoin (DOGE) price began a correction, dropping to $0.075. At this price level, DOGE began a period of consolidation, forming a range that was eventually broken higher. It is notable that this consolidation took place around the 61.8% Fibonacci retracement level from the last low and coincided with the cost line of the previous low. Finally, this price level, located in a value zone, highlights the importance of the $0.075 threshold.

Dogecoin now sits above its 50-day and 200-day moving averages, reinforcing the idea that DOGE is currently in an uptrend. Cryptocurrency momentum has clearly intensified, resulting in oscillators surpassing their median thresholds. While this is generally seen as positive, the RSI returning to the overbought zone could indicate the possibility of a consolidation or correction in the short term.

The current technical analysis was carried out in collaboration with Elie FT, a passionate investor and trader in the cryptocurrency market. Today trainer at Family Tradinga community of thousands of own-account traders active since 2017. You will find Lives, educational content and mutual assistance around the financial markets in a professional and warm atmosphere.

Focus on derivatives (DOGEUSDT)

It can be observed that the open interest of DOGE/USDT perpetual contracts has increased in parallel with its price, accompanied by a slightly positive funding rate. This simultaneous rise suggests that traders’ speculative interest is primarily oriented toward buying. Regarding liquidations, although subtle, they are mainly for the benefit of buyers, demonstrating selling capitulation.

The liquidation heat map for the DOGE/USDT pair over the past three months shows that the cryptocurrency has recently reached a significant liquidation zone. So far, it appears that buying interest persists, which is encouraging for a continuation of the uptrend. However, the most significant liquidation zones are now below the current price, notably around $0.08. If the price approaches these levels, it could trigger massive orders, increasing the risk of a period of heightened volatility for Dogecoin. This area therefore represents a crucial point of interest for investors.

Hypotheses for the price of Dogecoin (DOGE)

• If the DOGE price remains above $0.08, we could anticipate a continuation of the uptrend to $0.10 – $0.11. If the latter is crossed, the next bullish target could be $0.16. At this point, that would represent an increase of more than 60%.

• If DOGE internet price fails to hold above $0.08, we could see a pullback towards the $0.075 range. If the bearish movement continues, the next support level to consider would be around $0.065. At this level, the drop would represent around -35%.

Conclusion

Dogecoin seems to confirm buying interest, which suggests a continuation of its upward trend. To consider a breakout of resistance at $0.10, it is essential that buying interest persists. Thus, it will be crucial to carefully observe the price reaction at different key levels to confirm or refute the current hypotheses. It is also important to remain vigilant against potential “fake outs” and “market squeezes” in each scenario. Finally, let us remember that these analyzes are based solely on technical criteria and that the price of cryptocurrencies can also evolve quickly depending on other more fundamental factors.