As the cryptocurrency market continues to navigate the current uncertainties, traders and analysts are keeping an eye on a potentially important technical formation for Dogecoin price: a moving average crossover on its weekly chart.
As the cryptocurrency market continues to navigate the current uncertainties, traders and analysts are keeping an eye on a potentially important technical formation for Dogecoin price: a moving average crossover on its weekly chart.
The nature of the cross would determine whether it is a death cross, which is a bearish signal, or a golden cross.
A golden cross occurs when a short-term moving average, typically the 50-day moving average, crosses above a longer-term moving average, such as the 200-day moving average. This bullish signal is often interpreted as a strong indication of bullish momentum and potential. price increases.
While golden crosses can occur over various time frames, a weekly golden cross has particular significance as it reflects long-term trends and investor sentiment.
In the case of Dogecoin, the 50-week SMA is rising northwards and looks likely to move above the 200-week SMA, which may result in a golden cross formation in the coming weeks. While there are expectations of a golden cross, traders may need to keep an eye on the nature of the crossover to affirm it.
Dogecoin’s journey towards this imminent crossover has been marked by a series of ups and downs. Following a steady decline since May 6 from highs around $0.168, the dog-themed coin has shown resistance, finding support around the $0.142 level.
At the time of writing, Dogecoin was trading down 4.68% in the last 24 hours at $0.144 as the crypto market faced selling pressure.
Implications of a possible golden cross
The last time Dogecoin witnessed a weekly golden cross was in early January 2021, resulting in a staggering 7,996% price increase over the next four months. Dogecoin subsequently reached an all-time high of $0.737 on May 8, 2021.
While past success is no guarantee of future results, the prospect of another golden cross has certainly captured the imagination of the DOGE community.
For traders, the golden cross is a signal to watch closely as it could indicate the beginning of a new uptrend. However, it is important to approach these indicators with caution as they can sometimes generate false signals, trapping traders on the wrong side of the market.
