Dogecoin (DOGE) Price To Develop A Bullish Divergence, Stashing By The Time Of A Parabolic Surge

Last Thursday saw Dogecoin price slide as the broader crypto market pulled back, taking the token back to $0.16, a level not seen in several months.

Despite the gloomy shift in trend, DOGE’s medium-term and long-term outlook remains bullish as crypto analysts are now spotting a key signal that may herald an imminent parabolic surge.

What Happened: During the last hours of Thursday, Thursday, saw crypto market pull back, causing Dogecoin (CRYPTO: DOGE) to experience a decline.

The dog-themed meme coin slid, returning to the $0.16 price point.

However, Trader Tardigrade, a technical expert and investor, spotted a key development on the DOGE chart that may herald a shift in the trend toward the upside.

The crypto analyst explained that DOGE is still showing signs of a major upswing despite being in a down-trend. This is supported by a historical bullish signal that has seen to work in the last two attempts within a yearly time period.

After a period of relative strength, this bullish signal has now returned on the weekly time frame chart, increasing the likelihood of a notable impending parabolic surge. It is crucial to note that the trend usually follows key signals from the DOGE/BTC chart.

As seen on the weekly chart, lower lows are being formed by the DOGE/BTC pair prior to each Dogecoin huge pump within the past year. Nevertheless, these significant bullish moves tend to be more effective once DOGE’s price begins to trend upward on the weekly chart.

At present, Dogecoin’s weekly price action indicates that the meme coin is at a pivotal juncture, and the DOGE/BTC pair appears to have completed new lower lows. With the signal repeating itself, the expert is optimistic that a massive pump is forthcoming, potentially propelling DOGE’s price above the $0.70 mark and toward a new all-time high.

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Why It’s Important: As DOGE trades toward key support, key momentum indicators are suggesting that the current bearish move may be short-lived.

Dogecoin’s Relative Strength Index (RSI) has reached a crucial point that is likely to strengthen its upward outlook.

According to Trader Tardigrade, DOGE is heading back to the previous swing low, while the RSI indicator is displaying a higher low after a sharp decline. The expert claims that this signal may result in a bullish divergence, suggesting that the selling momentum is weakening.

A bullish divergence, typically occurs when an oscillator drops to hit a new low and prices reach a new low, signaling a potential upward trend reversal after a period of decline.

Hence, Trader Tardigrade noted that DOGE is showing an early sign of a bullish reversal, kicking off the beginning of another major rally.