Dogecoin (DOGE) appears to be gearing up for a bullish reversal after enduring a prolonged downtrend. Notably, a crypto analyst has shared a technical report outlining four compelling reasons why now may be an opportune time to buy DOGE. With the meme coin expected to execute a breakout to new price highs soon, purchasing it at a lower price could set investors and traders up for potentially huge gains.
Why Dogecoin Is The Smart Buy Now
TradingView crypto analyst KJThaLibra has shared a detailed chart analysis of Dogecoin, explaining why buying the meme coin at its current price may be the smartest move investors could make. The analyst highlighted four compelling reasons that support a potential bullish breakout for Dogecoin.
The first and most compelling reason outlined by the analyst is the presence of a Bullish Divergence pattern on the Relative Strength Index (RSI). While DOGE’s price recently recorded a lower low, the RSI has printed a higher low, signaling weakening bearish momentum. This divergence often precedes trend reversals and has historically been a reliable early indicator of upside movement.
The second reason emphasized by the TradingView analyst is that Dogecoin’s RSI has entered oversold territory on the daily chart. This suggests that selling pressure may be overextended, and a price bounce could be imminent as buyers regain control. Further supporting this is the formation of a higher low in price action. This structural development breaks the pattern of lower lows that have defined Dogecoin’s multi-month downtrend.
A higher low on the daily chart reflects a possibly strengthening market sentiment and a potential reversal from bearish conditions. Notably, Dogecoin’s higher low is positioned just below a critical descending trendline that has acted as a resistance since 2024, adding further weight to it’s bullish setup.
Confirmed Resistance Sets Stage For Major DOGE Rally
The aforementioned descending trendline has been tested multiple times by Dogecoin in the past. KJThaLibra has stated that typically, the more frequently a resistance trendline is respected, the more intense a breakout tends to be once it is finally breached.
With Dogecoin currently trading just below this critical trendline, a decisive breakout above it, especially supported by strong volume, could trigger a wave of momentum, potentially propelling the meme coin’s price to new highs. According to KJThaLibra’s chart, the projected scenario points to a rally toward $0.4. This bullish thesis, underpinned by the confirmed resistance, is the final reason the analyst believes now is a good time to buy Dogecoin.
Notably, the trajectory of the outlook involves a breakout above the trendline, followed by a brief retest of the broken resistance as a new support and then a possible bullish continuation to higher price levels. Currently, Dogecoin is trading at $0.18, meaning a surge to $0.4 would represent an impressive 122.22% increase.
Featured image from Getty Images, chart from Tradingview.com
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