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Crypto analyst Ali Martinez (@Ali_charts) has highlighted a potential trend reversal for Dogecoin, revealing that the popular memecoin has flashed a bullish technical signal on its daily chart. According to Martinez, the TD sequential indicator has presented a ‘buy signal’, suggesting a price rebound could be on the horizon.
Dogecoin prints TD9 Buy signal
The shared chart – daily candlesticks of the Doge/USDT pair span – illustrates 10 days of downward price action. Dogecoin has pulled back from previous highs near $0.4843 to trade at around $0.32, shedding around -35% in recent days. The most recent candle in the chart is a long black (bearish) bar, reflecting notable selling pressure that pushed prices towards $0.3200.
“The TD-sequential presents a buy signal on the Dogecoin Daily Chart, anticipating a price rebound!” Martinez posted Via Developed by market technician Tom Demark, the TD sequence aims to identify price exhaustion points and potential reversals in ongoing trends. It works by counting a series of consecutive candles in one direction.
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The indicator usually monitors up to nine consecutive bearish or bullish candles. When a count of nine is reached during an ongoing downtrend, it often marks a potential bullish turning point – referring to as a “TD9 buy signal”. Conversely, nine consecutive higher closes in an uptrend can indicate a potential bearish reversal.
In more elaborate setups, the indicator can continue to count to 13 and provide further confirmation, but the “9” signal itself often draws the most immediate attention from traders. On this Dogecoin chart, the TD9 number has just appeared, meaning the daily downtrend may reach a point of copper interest. After a “9” candle, the range restarts at “1”, which could indicate the start of a new bullish setup, should the upcoming candles confirm the reversal.
Price levels to watch
The most crucial support zone is at $0.313, the 0.382 Fibonacci retracement level on the daily chart. Maintaining a daily close above this level could strengthen bullish momentum as buyers respond to the TD9 signal. Any attempt at a rebound will likely encounter initial resistance around $0.3400, where the downside line is located. A decisive break above this (black) line could validate the expected trend reversal.
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Although further out of reach, regaining ground in the $0.4000 area (0.5 Fibonacci level at $0.395) would be a stronger sign that Dogecoin has recovered from its downward spiral. Overall, Dogecoin is in a crucial spot. The “Buy” setup of the TD sequential doesn’t guarantee a upside, but it does historically serve as a reliable early warning of trend fatigue.
If bullish traders take advantage of this signal, Dogecoin could stage a price recovery against mid-range resistances. On the other hand, failure to hold the $0.3100 area could extend the current down cycle.
Featured image created with Dall.e, chart from TradingView.com