- Dogecoin continues to locate support around the handle high of a cup-with-handle base.
- DOGE closed last week with the best weekly performance since the beginning of May.
- Dogecoin price rally since the July low has been highlighted by three prominent positive days, each exceeding 10%.
Dogecoin price orchestrated a 15.61% gain on August 15 to confirm the original breakout from a cup-with-handle pattern on August 12. The spike higher was met with selling pressure, pressing DOGE down to the handle high of $0.288, before attracting a new bid. Nevertheless, the digital coin has not reclaimed the August 16 high of $0.355, setting the meme token to form a base on base pattern that may be the catalyst for a resumption of the developing rally.
Dogecoin price creates a new opportunity for latecomers
Despite the recent 80% correction and an 80% correction in January, Dogecoin price is still on pace to record six consecutive positive quarters. It has been a roller-coaster ride for DOGE investors, but the emergence from a cup-with-handle base has solidified the potential for the altcoin to seek out higher prices using a rare, but powerful base-on-base pattern.
The measured move of the original cup-with-handle base is 45%, claiming a DOGE profit target of $0.417 while breaking the resistance defined by the 38.2% Fibonacci retracement of the May-July correction. The target does fall short of the 50% retracement at $0.457 and the tactically important June high at $0.463.
To capitalize on a renewed Dogecoin price rally, speculators should target the August 16 high of $0.355 as the new entry price with a daily close below the handle high of $0.288 as the stop. The triggering of the base-on-base pattern reinforces the uptrend kickstarted by the August 7 gain of 28.14% and improves the potential for DOGE to break the resistance outlined by the 50% retracement and the June high.
A break above the June high of $0.463, a level reinforced by the mid-May highs, puts Dogecoin price in a favorable position to test the confluence of the 61.8% retracement at $0.529 with a series of DOGE highs printed in mid-May, before the May 19 crash.
DOGE/USD daily chart
If Dogecoin price does not activate the base-on-base pattern the stop remains a daily close below the rising 50-day SMA at $0.229. Alternatively, if DOGE does trigger the base-on-base pattern the stop is raised to the handle high at $0.288.
Dogecoin price initially broke out from the cup-with-handle base on August 12, but quickly reversed back into the handle, before confirming the breakout on August 15 with a 15.61% gain. However, DOGE pulled back again, testing the handle high which it has held so far.
Here, FXStreet’s analysts evaluate where DOGE could be heading next as it seems poised to advance further.