Dogecoin jumped as much as 40% higher yesterday, thanks to gains from Shiba that began to rotate into other markets. To discover where this cryptocurrency is heading, here we carry out a situational analysis.
At the time of this writing, DOGE is trading at $ 0.28, accumulating a loss of 4.94% in the last 24 hours, but maintaining an 18.66% gain in the last 7 days.
When we compare the Dogecoin chart with the Shiba Inu chart, we notice a clear inverse correlation. This confirms that the earnings turnover is what favored DOGE yesterday.
SHIB vs USDT and DOGE vs USDT charts. Source: TradingView.
Let’s remember that these are two currencies that are quite correlated, since the place they have earned in the crypto market is mainly thanks to great speculation.
Yesterday’s earnings from DOGE also appear to have been the product of speculation, sponsored by Elon Musk as usual, even if that is not his intention.
And it is that seconds before the momentum of the crypto meme began, Elon had commented on the tweet of the “creator of Dogecoin”, where he spoke about scams in the ecosystem.
Elon’s tweet was as follows:
If I send you 2 Doge, will you promise to send me 1 Doge?
– Elon Musk (@elonmusk) October 27, 2021
It may be that with several more tweets, the gains will spread; and it seems that in this segment of the market that is all that is needed.
In any case, it is worth reviewing how the price behaves, and what signals it is leaving us.
Dogecoin Could Rebound As Shiba Rally Cools Down
In the weekly chart DOGE vs USDT we see how the price has managed to remain bullish in the long term, thanks to the impossibility of marking lower lows.
At this point it seems quite likely that the bears are already exhausted, so the retracement bottom has surely already been reached.
After almost 6 months of retreating, now Dogecoin could resume its uptrend, and at this time that the momentum of Shiba seems to cool down, it may be the right time.
To confirm that the bulls have regained control of DOGE, the immediate resistance at $ 0.31 must be broken. If it happens, which is the most likely, we could even see a new all-time high.
However, it is worth bearing in mind that already with the capitalization that it has of $ 37,390 million, it is extremely difficult to think of too large profits, because we remember that there really is no fundamental basis that defends this capitalization. It is up to you to discern how sustainable what is happening is.
Dogecoin jumps higher as the Shiba Inu rally cools off. Source: TradingView.
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