The crypto analyst Balo (@btcbalo). marked a major technical breakout on the Dogecoin (DOGE/USD) chart that indicates a bullish trend in the near future. Balo's analysis, based on a 4-hour chart, points to several key technical developments that lead to the expectation of a continued upward movement in Dogecoin's price.
Why Dogecoin Looks Close to Rallying
A cornerstone of Balo's assessment is based on Dogecoin's decisive break of a long-term decline line on December 28. This decline line, first established from the December 8 apex of $0.48, has been a strong defensive level, effectively influencing DOGE's price movements throughout December.
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The break above this trend line marks a critical turning point. After this ascent, Dogecoin experienced a small movement in which the memecoin quickly reconfirmed the broken movement line. However, the retest was successful, confirming the bullish outlook for Dogecoin.
Adding to the break out of the decline The spread line is a descending triangle pattern that had been forming since December 21st. A descending triangle is characterized by a series of lower highs joining a support level to a flat level, often indicating a bearish continuation.
However, Dogecoin's ability to break out of this formation today, on January 2 suggests a shift in market sentiment. The emergence from the descending triangle, along with the breakout, adds to the bullish narrative, although a retest of the upper boundary of the triangle could further confirm this trend. up
The volume profile is at the heart of Balo's thesis of major breakouts, which offers a superior understanding of trading activity at different price levels. Dogecoin has bounced back from substantial support at the top group around $0.32, showing a strong base of accumulated trading interest.
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On the upside, the volume is thin until the $0.40 division, where there is a large accumulation of up to $0.43. This rally means that above this zone, DOGE may encounter little resistance, paving the way for Dogecoin to target its annual level of $0.4834, which was recorded on December 8.
Strengthening the bullish outlook is the completion of the ABC pattern on the Dogecoin chart. The ABC pattern is a corrective order in technical analysis that usually indicates the end of a retracement level and a continuation of the previous trend. In the case of Dogecoin, the completion of this pattern closely aligns with the other bullish signals derived from the fracture profile and volume analysis.
Therefore, Balo said “DOGE (is) starting to break out, I don't see any reason to stop now. Real new highs soon,” could indicate that DOGE is heading for a new high.
At press time, DOGE was trading at $0.34.
Featured image created by DALL.E, a chart from TradingView.com
