The Dogecoin/Bitcoin (DOGE/BTC) showed signs of weakness on January 12, 2018 when it generated a lower high of 0.00000093. The price action marked the end of wave 2 of a downtrend. It also signalled the beginning of a long third wave that saw the pair plummet to as low as 0.00000035 on February 2. In less than a month, the pair lost over 62% of its value.
Fortunately for bottom pickers, the market appears to respect the 23.6% Fibonacci level. DOGE/BTC bounced to 0.00000079 on February 15 to cap off a strong wave 4 rally. The fifth and final wave down drove the market back to the 23.6% Fibonacci level where it created a new base until April 4.
The pair has been rallying since. Also, it looks ready to jumpstart a bull run.
Technical analysis reveal that DOGE/BTC has rallied to as high as 0.00000072 on April 19. The price movement appears to be the A-wave of an ABC corrective pattern. As 0.0000007 is a firm resistance as well as the 61.8% Fibonacci level, the pair pulled back to 0.00000049 on May 11. At this point, however, it looks like the market is respecting support of 0.0000005 while carving a bullish higher low setup.
The strategy is to buy as close to 0.0000005 as possible. If bulls hold on to this level, they will attract more bottom fishers. This may ignite a C-wave rally that can take us to our target of 0.0000007.
The process may take less than a month.
Daily Chart of Dogecoin/Bitcoin on Poloniex
As of this writing, the Dogecoin/Bitcoin pair is trading at 0.00000053 on Poloniex.
Summary of Strategy
Buy: As close to 0.0000005 as possible.
Disclaimer: The writer owns bitcoin, Ethereum and other cryptocurrencies. He holds investment positions in the coins, but does not engage in short-term or day-trading.
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