Key Takeaways
The recovery from the range low reinforced the idea that DOGE traders should play the range. A 27% rally could arrive over the next week or two, but demand needs to increase.
Dogecoin [DOGE] was in a bullish trend over the past two weeks. Since the 7th of July, Dogecoin rallied 19.7% while Bitcoin [BTC] was up 8.75% during this time.
It’s fair to say that the bullish sentiment around Bitcoin — as it set new all-time highs against the U.S. Dollar — has positively impacted the altcoin market.
Bitcoin added $11k this week after moving above a descending channel, and further gains could be expected in the short term. The on-chain metrics revealed that the BTC market was not overextended.
This could help both DOGE and the memecoin sector in the coming weeks.
Dogecoin’s buying opportunity
Source: DOGE/USDT on TradingView
The 1-day chart showed a retest of the $0.142 range lows on the 22nd of June. Since then, the leading memecoin has formed higher lows and higher highs, shifting to a bullish market structure.
The $0.173 resistance posed an obstacle in early July. The BTC rally of the past week helped Dogecoin to swat this resistance aside.
The mid-range level at $0.196 was another stern resistance, because it coincided with the bearish order block from mid-June. On the 11th of July, DOGE managed to surpass this supply zone as well.
At the time of writing, it was likely to act as a demand zone, where Dogecoin could rebound from.
The OBV was still under the high made in June, which was an early warning sign of reduced buying pressure over the past two weeks.
Source: CoinGlass
Dogecoin’s liquidation heatmap showed that there was a minor chance of a price dip to the $0.19 liquidity cluster. The magnetic zone at $0.23 was the next region to watch out for.
Since the price is drawn to liquidity, it is likely that we see Dogecoin extend its rally and reach the $0.23-$0.25 supply zone next.
Traders should be cautious as price approached the range high, and might have to prepare to go short. Until there is a clear breakout and retest of the $0.25 level, traders should expect the range-bound price action to continue.
Disclaimer: The information presented does not constitute financial, investment, trading, or other types of advice and is solely the writer’s opinion
