Analyst Predicts 45% Dogecoin Rally With Bull Flag Pattern

Dogecoin (DOGE) has maintained its bullish momentum, with its current price reaching $0.41600. However, the recent rally has pushed DOGE above an overbought level (70), indicating a potential pullback.

Strong Uptrend and Overbought Conditions

Since early November, Dogecoin's price has surged, surpassing the upper Bollinger Band. While this suggests strong buying pressure, it also raises concerns about overbought conditions.

The Relative Strength Index (RSI) has reached 91.44, well above the overbought threshold. This signals a potential market correction.

Consolidation and Resistance

The upper Bollinger Band acts as an overbought signal. When prices trade above it, they may encounter resistance.

A consolidation period is often necessary for an asset to stabilize and regain its upward momentum. A pullback to the middle Bollinger Band (around $0.20385) could provide DOGE with an opportunity to consolidate before resuming its upward trajectory.

Immediate resistance remains at the recent high of $0.41600, where bearish selling pressure could emerge.

Support Levels

Key support levels to consider are $0.35737, close to the current price, and the middle Bollinger Band at $0.20385 in case of a deeper pullback.

Bull Flag Pattern and $0.35 Support

Analyst Ali highlights a bull flag pattern in Dogecoin's short-term chart, indicating a potential for higher prices.

The bull flag pattern involves an upward surge, followed by a sideways correction within a falling pattern, before another surge.

If DOGE breaks out of its consolidation zone, Ali suggests a possible 45% price increase, targeting $0.56.

Traders should monitor the following:

• A breakout above the bull flag's upper trendline
• High trading volume
• Holding above $0.35 as a key support level for the bull flag