Dogecoin (CRYPTO: DOGE) was running almost 7% higher at one point on Wednesday morning before giving back more than half of its gains by early afternoon.
The Shiba-Inu-themed cryptocurrency was thrust into the spotlight again recently after McDonald’s Corp (NYSE:MCD) responded to Dogecoin co-creator Billy Markus, who wrote “I want a fry,” on Twitter Inc (NYSE:TWTR) with an image of the popular meme with a French fry.
The image has received more than 15,000 likes and McDonald’s may now be debating whether or not to accept Dogecoin as payment.
On Tuesday, McDonald’s bantered back at Tesla Inc.’s (NASDAQ:TSLA) CEO Elon Musk on Twitter in response to Musk saying he would eat a Happy Meal on television if the fast-food giant agreed to accept the crypto. McDonald’s said it would accept Dogecoin but only if Tesla agreed to accept grimacecoin, a new micro crypto that didn’t exist until Wednesday.
Despite the series of posts on Twitter, Dogecoin has failed to make any major gains. But, that may be set to change if the crypto can continue in its current trend.
The Dogecoin Chart: Dogecoin began trading in an uptrend on Jan. 22, after reaching and bouncing up from a low at the 12-cent mark. The crypto has since made a series of higher highs and higher lows to confirm the trend with the most recent higher high printed on Tuesday at $0.154 and the most recent higher low of $0.125 created on Monday.
On Wednesday, Dogecoin was printing an inside bar on the daily chart with its price range completely inside Tuesday’s mother bar. The pattern leans bullish because Dogecoin was trading higher before forming into the pattern, but traders can watch for a break of the inside bar on Wednesday to confirm future direction.
In order for the break of the inside bar to be confirmed, traders and investors will want to watch for higher-than-average volume to come in on lower timeframes. On Wednesday, Dogecoin’s volume indicated the crypto was in a period of consolidation, coming in at just 407,000 compared to the 10-day average of 479,044 by late afternoon.
Dogecoin is trading below the eight-day and 21-day exponential moving averages (EMAs), with the eight-day EMA trending below the 21-day, both of which are bearish indicators. The eight-day EMA is currently acting as a heavy resistance level for the crypto.
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- Bulls want to see big bullish volume come in and break the crypto up from the inside bar pattern, which will allow the crypto to regain the support of the moving averages. There is resistance above at 16 cents and $0.176.
- Bears want to see big bearish volume come in and knock Dogecoin down below the $0.125 mark, which will negate the current uptrend. There is support below that level at 12 cents and the 10-cent mark.