Dogecoin has been on a tear lately, reaching a price of $0.1491. But this rapid rise has some analysts worried.
Overbought Signals
The Relative Strength Index (RSI) is a technical indicator that measures how much an asset’s price has moved up or down over a specific period. When the RSI goes above 70%, it signals that the asset might be overvalued and a correction could be coming.
Right now, Dogecoin’s RSI is sitting at a whopping 80%, indicating that it’s very overbought. This means that buying pressure is slowing down, and sellers might be starting to take profits.
Signs of Weakness
Looking at the 4-hour chart, Dogecoin failed to break through the $0.1491 resistance level. This suggests that the bulls are losing steam and a pullback might be in the cards.
On the daily chart, we’re seeing a “rejection wick” which indicates that buyers tried to push the price higher but were met with strong selling pressure. This is another sign that the bullish momentum is weakening.
What’s Next for Dogecoin?
The future of Dogecoin depends on whether the bulls can maintain control. If they can push the price above $0.1491, then we could see more upward movement. However, if they fail, we could see a correction back down to the $0.1293 support level.
If the price falls below $0.1293, it could trigger further downward movement, pushing Dogecoin towards lower support levels.
Ultimately, it’s still too early to say whether Dogecoin’s rally is over. However, the overbought signals and signs of weakness suggest that a correction might be on the horizon.
