Dogecoin In Tight Zone: Why A Rally Will Happen If DOGE Clears $0.076
08 Novembro 2023 - 2:00PM
NEWSBTC
An analyst has explained how the next major Dogecoin resistance
hurdle would be at $0.084 if the memecoin manages to clear $0.076.
Dogecoin Is Currently Sandwiched Between Major Support And
Resistance Levels In a new post on X, analyst Ali has discussed
what the on-chain support and resistance levels are looking like
for Dogecoin right now. A price level is said to be an on-chain
support or resistance level on the basis of whether a large number
of investors share their cost basis at it or not. “Cost basis” here
naturally refers to the average price at which a holder acquired
their DOGE. When the spot price is below the cost basis of an
investor, they are naturally in a state of loss, while it being
above implies they are enjoying positive returns. Related Reading:
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The below chart shows what the distribution of Dogecoin investors
looks like currently on the basis of the price range that their
cost basis lies. Looks like the current price levels are surrounded
by major investor blocks | Source: @ali_charts on X For any
investor, their cost basis is an important psychological level and
they may be prone to making some moves whenever the spot price
retests it. Thus, if a large number of holders share their cost
basis close together inside a particular range, the market could
potentially see a sizeable reaction when the asset’s price ventures
into the range. Generally, whenever this retest happens from above
(that is, the investors had been in profits before this), the meme
coin’s price could feel some degree of support. The reason behind
this is that the holders may tend to believe that if this same
level had been profitable earlier, it might be so again in the
future, so they participate in some accumulation. The opposite is
the case whenever the Dogecoin price retests the cost basis of a
large amount of investors from below. These investors would be
tempted to exit at their break-even so the cryptocurrency could
face resistance. From the above graph, it’s visible that the DOGE
levels above and below the current price both host the acquisition
points of a large number of addresses. In particular, the $0.071 to
$0.073 range has the cost basis of almost 200,000 holders, while
the $0.074 to $0.076 range has 124,000 addresses. Related Reading:
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“Note that support outstrips resistance in strength, hinting at the
potential for an upward breakout,” says Ali. If Dogecoin can manage
to clear this range of significant resistance off the back of this
strong support, the next price level where it will face a hurdle
would be around $0.084. The in-between levels all have a relatively
low amount of investors, so at least in theory, the memecoin
shouldn’t have too hard a time mowing through them. Especially
considering that, once the $0.076 level is through, the block
that’s providing resistance right now would turn into a support
boundary. DOGE Price Dogecoin is currently battling against the
resistance offered by the aforementioned range as its price is
floating around $0.075. The price of the memecoin appears to have
been going up recently | Source: DOGEUSD on TradingView Featured
image from iStock.com, charts from TradingView.com,
IntoTheBlock.net
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