When the market builds up enough momentum to push past predetermined resistance levels or decline toward support, such a pattern frequently serves as a prelude to a significant price movement. There could be a significant price increase for SHIB if this convergence is successful in producing an upward breakout. Crucial resistance levels are located around $0.000018 and $0.000019.
A bullish rally might be fueled if these levels are broken, which would encourage more buying pressure. In contrast, if the volatility spike causes SHIB to decline, the asset must remain above the most recent trendline support, which is located at $0.0000168, in order to preserve the bullish structure. The Relative Strength Index (RSI) is presently in a neutral zone, which adds to the optimism by indicating that SHIB has potential for upward momentum without hitting overbought territory right away.
As can be seen from the current chart, Dogecoin has seen a significant upswing in recent weeks, breaking through multiple resistance levels with considerable force. A price pullback is required for a more sustainable growth pattern because this type of abrupt ascent frequently results in overbought conditions. A classic technical setup in which an asset can reset before resuming its trend seems to be in line with the current retracement. A contributing factor to the positive perception of this correction is the existence of support surrounding the 50-day and 100-day EMAs.
These moving averages may provide Dogecoin with a solid foundation from which to recover as they are currently convergent close to important price levels. According to technical analysis, these support levels can serve as launching pads, enhancing the asset’s ability to sustain its upward trend.
As for market sentiment, Dogecoin continues to have a strong following, which will probably lead to fresh buying pressure once this correction levels off. Furthermore, the Relative Strength Index (RSI) has shifted away from overbought levels, suggesting that DOGE can now rise without encountering selling pressure right away.
In uptrends, the 26 EMA, which is represented by the green line on the chart, frequently serves as a dynamic support level drawing buying interest during corrections. Bitcoin bounced back when it fell to this level in the past, and if the same support materializes now there may be a significant short-term rally. It’s important to understand that even though the 26 EMA provides a technical configuration that might lead to a reversal, this situation is not a surefire way to recover.
Given the possibility of additional declines in the event that the EMA support fails, the recent downward momentum in Bitcoin calls for caution. Then BTC might retest lower supports such as the 50 or even 100 EMAs. However, Bitcoin may rapidly regain momentum and make another move toward the $70,000 mark if buyers get in at the 26 EMA. This level has turned into a psychological barrier, and a strong close above it might rekindle optimism and push Bitcoin to test its prior all-time highs.
To summarize, the way that Bitcoin reacts to the 26 EMA could determine its short-term course. Even though a recovery could be sparked by this level, investors should be ready for either scenario.
This article was originally published on U.Today
Source: Cryptocurrency - investing.com
