Story Highlights
- Dogecoin price is up big, leading a rally in meme coins.
- Analysts say DOGE may have bottomed out, with room for growth to $0.20.
- Caution advised before buying: wait for DOGE to break key levels or see a pullback before jumping in.
Dogecoin (DOGE), the self-proclaimed “original meme coin,” has been on a tear lately. After several weeks of trading sideways, DOGE surged 13% in a single day, leading the charge among other meme coins like Shiba Inu and Floki Inu. This bullish trend has many investors wondering: is Dogecoin finally hitting its bottom and ripe for the picking?
Dogecoin Bullish Signs: A Confirmed Bottom and Room for Growth
There are positive signs for DOGE. Analysts point to the recent price holding steady at $0.1290 as a confirmation of a bottom. This support level, coupled with the overall positive momentum in the meme coin sector, suggests room for growth. Additionally, if Bitcoin, the leading cryptocurrency with a major influence on the entire market, maintains its bullish trend, DOGE could potentially reach $0.20.
Should You Buy? Proceed with Caution
However, experts advise caution before jumping into a DOGE purchase. While the overall outlook appears promising, some factors could lead to a reversal. Dogecoin’s price hasn’t yet broken above the key centerline of a technical indicator called the Bollinger Band. This could signal a shift in momentum and a potential price drop. Additionally, the Relative Strength Index (RSI) sits at 48, indicating no dominant trend yet.
TOP 7 TOKENS WITHIN THE BLOCKCHAIN
— Crypt01 Daily (@Crypt01_Daily) May 4, 2024
1⃣WIF – @dogwifcoin
2⃣STX – @Stacks
3⃣FLOKI – @RealFlokiInu
4⃣DOGE – @dogecoin
5⃣GRT – @graphprotocol
6⃣PEPE – @pepecoineth
7⃣RNDR – @rendernetwork#Altcoins #BTCs #Cryptos #ETH pic.twitter.com/pb4EFxOaCP
Another concern is the profit potential for current holders. Data suggests a large portion of DOGE addresses are “in the money,” meaning they’ve bought at a lower price and stand to make a profit. This could lead to selling pressure as investors cash out, potentially hindering further price increases.
What to Watch Before Buying
For those interested in buying DOGE, analysts recommend waiting for certain signals. A strong indicator would be DOGE surpassing the $0.1498 centerline and the RSI climbing above 50. Additionally, a retest of the centerline with a confirmed higher high on the RSI would be an even more conservative, but potentially safer, entry point.
Ultimately, the decision to buy DOGE depends on your individual risk tolerance and investment strategy. While the recent price surge and positive outlook for meme coins are enticing, careful consideration of the potential hurdles is crucial before diving in.
