Dogecoin (DOGE) May Be Primed for a Bullish Breakout, Key Technical Indicator Nears a Crossover

An analyst has recently pointed out that Dogecoin may be on the verge of a significant bullish shift, marked by an impending crossover of a key technical indicator.

Dogecoin may be preparing for a major bullish shift, an analyst has suggested, as a key technical indicator is nearing a crossover.

Ali Martinez shared his analysis on social media, suggesting that the “Moving Average Convergence/Divergence” (MACD) indicator for Dogecoin is close to a crossover.

The MACD is a momentum indicator used in technical analysis to identify potential buy or sell opportunities for an asset. It calculates the difference between two Exponential Moving Averages (EMAs) of the asset, typically using 26-period and 12-period EMAs and plotting these values as the MACD line. Another line, the signal line, is also used, which is essentially a nine-period EMA of the MACD line.

Recent data shows that Dogecoin’s MACD and its signal line are converging. The signal line is currently positioned above the MACD line, but if trends persist, this arrangement could soon be reversed. Historically, such a crossover has been observed to be a bullish indicator.

Martinez's analysis includes a chart displaying Dogecoin's MACD trend over the last year, highlighting the previous two instances of this crossover. “The last two times Dogecoin had a MACD bullish crossover on the weekly chart, it rallied 90% and 180%, respectively,” he notes. Given this history, there is speculation that Dogecoin could experience a similar price hike should the crossover occur again.

In other developments, the number of active Dogecoin addresses has seen a substantial increase. Martinez pointed out this activity in a separate post, mentioning that the metric has reached a high of 84,306 active addresses, the highest seen in about six months. This increase in active addresses coincides with a recent decline in Dogecoin's price, indicating heightened trading activity, which is usually triggered by market volatility.

At the time of writing, Dogecoin is trading at around $0.105, showing a decrease of nearly 4% over the last week. The coin's recent trajectory has been bearish, with the price chart reflecting this downturn.

The increasing activity and potential bullish crossover in the MACD suggest that Dogecoin's market could be set for significant movement in the near future.

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