The Dogecoin (DOGE) worth rally prolonged additional on Oct. 29 in hopes that the cryptocurrency would get a serious increase from Elon Musk’s Twitter acquisition.
Elon Musk boosts Dogecoin worth once more
Dogecoin worth jumped by almost 75% to achieve $0.146 on Oct. 29, the most important every day achieve since April 2021.
Notably, the meme-coin’s huge intraday rally got here as part of a broader uptrend that began earlier this week on Oct. 25. In complete, DOGE’s worth gained 150% throughout the Oct. 25-29 worth rally.
The surge was additionally accompanied by an honest improve in its every day buying and selling volumes. That coincided with a spike within the variety of DOGE transactions exceeding $100,000, in accordance with Santiment. Each indicators sugges a rising demand for Dogecoin tokens amongst wealthy traders, or so-called “whales.”
The leap throughout Dogecoin’s key metrics replicate traders’ pleasure about Elon Musk’s Twitter acquisition on Oct. 27. Earlier this yr, the billionaire entrepreneur had flirted with the concept of constructing Dogecoin a fee technique to buy the Twitter Blue subscription.
Musk’s Tesla and SpaceX already settle for DOGE funds for his or her merchandise.
$DOGE, the official foreign money of Twitter.
— David Gokhshtein (@davidgokhshtein) October 28, 2022
Shiba Inu, meme-coins comply with DOGE
Shiba Inu (SHIB), the second-largest meme token by market capitalization, posted a copy-cat rally as effectively.
On Oct. 29 alone, SHIB’s worth jumped by 30% to $0.00001519, its highest degree since August 2022. Like Dogecoin, Shiba Inu’s rally got here as part of a broader uptrend that began on Oct. 25. Since then, its worth has gained 53%.
Moreover, different meme cash have jumped massively within the mentioned interval, together with Dogelon Mars (ELON), which rallied 140%.
Dogecoin most overbought since April 2021
Dogecoin’s ongoing worth rally is beginning to look overstretched, nonetheless, in accordance with a basic technical indicator.
The relative power index (RSI), a momentum indicator figuring out the diploma of current worth modifications to investigate overbought or oversold ranges, has risen to 93.69 on the every day Dogecoin chart. That is the best degree since April 2021, a month earlier than the DOGE worth rallied to its file excessive of $0.75.
Due to this fact, the “overbought” circumstances don’t essentially imply a right away bearish reversal. However they do replicate the present euphoric shopping for momentum available in the market, which eventually prompts the worth to development both sideways or appropriate downward.
Dogecoin’s 2018-2020 bear market on a weekly chart sheds gentle on comparable worth motion. Notably, DOGE crashed by nearly 95% nearly two years after peaking at $0.0194 in January 2018.
Associated: Bitcoin worth broke out this week, however has the development modified?
The token’s correction interval noticed it trending inside a descending channel. It broke out of the vary to the upside in July 2020 however adopted the upside transfer with a sideways consolidation development — between its 0 Fib line of 0.0022 and 0.236 Fib line of $0.0054 — till December 2020.
Compared, Dogecoin’s ongoing bear market is shorter however reveals an identical development trajectory to the 2018-2020 interval, as proven above. Due to this fact, DOGE might fluctuate inside its present 0-0.236 Fib line vary (or the $0.055-$0.176 vary) following its descending channel breakout.
In different phrases, DOGE may appropriate towards $0.055 by the tip of this yr, down about 60% from present worth ranges, if the fractal performs out as supposed.
Conversely, a right away breakout above the 0.236 Fib line may have DOGE eye $0.25 as its subsequent upside goal.
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