An analyst has pointed out how Dogecoin could see a rally to $0.36 or even $0.45 if its price can manage to break past this resistance barrier.
There are a few different types of parallel channels, each with a distinct orientation of the trendlines in respect to the graph axes. The Ascending Channel forms when the trendlines are angled upward. That is, when the price travels to a net upside inside the channel. Similarly, the Descending Channel has trendlines that have a negative slope.
In the context of the current topic, neither of these versions of the Parallel Channel is of interest, but rather the most simple case of the pattern: a channel parallel to the time-axis.
When the asset is moving inside this type of channel, it observes resistance at the upper line and support at the lower one, and moves in an exactly sideways manner trapped between the two.
Now, here is the chart shared by Martinez that shows the Parallel Channel that Dogecoin has been stuck inside for the last few months:
As is visible in the above graph, Dogecoin retested the upper line of the Parallel Channel earlier in the month, but found rejection. The memecoin now appears to be approaching another retest of this line situated at $0.29.
Generally, a break above the upper line of a Parallel Channel is considered to be a bullish signal. Thus, if DOGE can manage to surge above the pattern, it may see a sustained rally.
Martinez has suggested two potential targets for the memecoin: $0.36 and $0.45. These are based on the fact that Parallel Channel breakouts can be of the same length as the height of the channel; the former corresponds to half this distance and latter to the full one. It now remains to be seen whether Dogecoin can surpass this huddle in the near future and if any sustained bullish momentum will follow.
From the above chart, it’s visible that DOGE whales have added a total of 158 million tokens of the cryptocurrency (worth $41.9 million) to their holdings with this accumulation spree.
At the time of writing, Dogecoin is trading around $0.265, down more than 6% over the last 24 hours.
