The cryptocurrency market could be in for a hot weekend as the dog days of summer approach.
Bitcoin (CRYPTO: BTC) regained the $50,000 level Fridat after receiving follow through on a bull break from a descending channel Benzinga called out on Thursday.
Dogecoin (CRYPTO: DOGE) has completed its own bullish pattern and on Friday was attempting to confirm the pattern was recognized. If it is, Dogecoin could be in for a long run over the coming days.
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The Dogecoin Chart: After reaching an Aug. 16 high of 35 cents, Dogecoin began a weeks-long period of consolidation. In its consolidation, the crypto formed a bullish inverted head-and-shoulder pattern on the daily chart with the left shoulder created between Aug. 16 and Aug. 23, the head between Aug. 24 and Aug. 29 and the right shoulder between Aug. 30 and Sept. 1.
On Thursday Dogecoin attempted to break up bullishly from the pattern, but failed and fell down to test the neckline of the pattern as support. On Friday Dogecoin tested the level again and bounced up from it indicating the pattern has been recognized.
The measured move of the pattern is equal to the distance between the lowest part of the inverted head and the neckline. For Dogecoin’s pattern, the predicted move up is roughly 17%, which indicates the crypto could trade up toward the 36-cent level.
Dogecoin is trading above the eight-day and 21-day exponential moving averages (EMAs) with the eight-day EMA trending above the 21-day, both of which are bullish indicators. The crypto is also trading about 27% above the 200-day simple moving average, which indicates overall sentiment in Dogecoin is bullish.
Bulls want to bullish continuation and increasing volume break Dogecoin up above a higher resistance level at 31 cents. If the crypto can regain the level as support, it has room to bounce up toward the 35-cent mark. Bears want to see big bearish volume come into the crypto to drop it back down below the descending neckline of the head-and-shoulder pattern which would negate the formation. If Dogecoin loses the trendline as support, it could eventually fall down below a support level at 27 cents, which would put it on track to retest support at the 23-cent level.