Today´s cryptocurrency spotlight is on Dogecoin as it is making huge price movements, as all of you probably have noticed. But first I want to do a quick analysis of Bitcoins price movement.

Bitcoin ($BTC)

Bitcoin is still in a sideways movement consolidating somewhere between $18k — $22k. It has basically been in that channel for 4 months now, with the exception of a break above in July to August. No big spikes in volume, which let me think that we will not have a major move above or below one of these levels soon. All this certainly depends on the overall state of world development, war, recession and such factors. The $18k support has held strong, so as short term trades I would look to buy/cover the support area and sell/short the resistance area. If it breaks one of these areas with strong volume, and holds it, a major move could be coming, so be careful and don’t hold on to losing positions too long. I tend to do it from time to time and it does not end well, 90% of the time.

So far to the Bitcoin price movement. Now on to Dogecoin.

Dogecoin ($DOGE)

Dogecoin has made big moves, going from about $0.06 all the way to $0.15 as of right now. Probably fueled by Elon Musk’s acquisition of Twitter and speculation that comes with it, but also from short squeezes it seems like, as there are BIG candles in there. Well so far to where the price action comes from, but I don’t really care too much about that, if I am looking to trade the price action. The $0.15 area is important as a psychological number and could act as support or resistance depending on how high Dogecoin decides to go.

On the shorter timeframe the trend is still up, but it could consolidate in this range. If it can stay near or above $0.15 I could see it go higher, if shorts pile in to this. My idea would also be a short of Dogecoin, but wait until the party is over and it is clearly trending down for a trade that is a lot less stressful. I am expecting Dogecoin to fade back down when the volume dries up. Let it spike as high as it can and look for an area of high volume where the price quickly starts to change direction. This can be used as a risk level. Don’t get caught on the frontside, take the easier backside move, there will be enough room for it to go down. If Dogecoin still decides to go up above your entry or risk level, do not hesitate to cut your position and reassess the situation.

With Dogecoin going up, you can also trade other Memecoins, as they follow “the leader” of memecoins. Shiba Inu ($SHIB) is a possible option for a trade, as it follows Dogecoin along nicely.

I hope this helps you to get an idea for a trade. Be safe and don’t oversize. I appreciate every comments and feedback to deliver better articles and analysis in the future.

Have a good one,

Niklas

This is not financial advice, it is for educational purposes only.

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