According to Ali's insights, Dogecoin is showing signs of an incoming rally based on technical indicators like the Relative Strength Index and TD Sequential.
Elon Musk's recent tweets have sparked speculation that Dogecoin might be returning as a payment option for Tesla.
Musk's recent legal victory against Dogecoin investors could also solidify his support for the memecoin.
Dogecoin is trading in a descending wedge and holding onto support around $0.0933.
Investors should watch for a Dogecoin break above the $0.1 price level.
Dogecoin has been in a massive slump recently. The memecoin is now trading at a meagre 11.13% price increase year-to-date, which is considerably low compared to most other cryptocurrencies in the top 10.
However, according to several signs, there might be strong indications that a rally is on the horizon.
Here are some of the biggest reasons to be bullish on DOGE.
According to Ali Martinez, one of the most well-known crypto analysts on Twitter, Dogecoin is showing signs of an incoming rally, as we will soon see.
In a Twitter (X) post, the analyst highlighted that the memecoin is showing a “bullish divergence” against the Relative Strength Index.
But what does this mean?
The RSI, a momentum indicator, measures the speed of price movements.
A bullish divergence on this indicator means the downtrend might be poised for a reversal.
Ali also supported his outlook with readings from the TD Sequential, which is another popular tool.
According to the analyst, this, too, is flashing a buy signal—in essence, Dogecoin could be headed for a massive rebound soon.
Adding to the optimism, Tesla CEO Elon Musk recently tweeted something interesting about the memecoin.
According to a recent tweet from the tech mogul, Dogecoin might be on its way to returning as a payment option for the electric cars the company provides.
Interestingly, this came amid a recent legal victory between Musk and a group of disgruntled Dogecoin investors, who claimed that Musk repeatedly manipulated the price of the memecoin via his tweets between 2021 and 2023.
Musk’s endorsement of Dogecoin as a payment method came as a response to another tweet from Sir Doge about the memecoin’s return as a payment option for Tesla merchandise.
In another post, the Tesla CEO sparked even more speculation about DOGE being used to evade issues like the unlawful closure of Starlink's bank accounts amid Brazil's ongoing X ban.
These responses have fueled speculation that Dogecoin might soon get a massive boost in use case, leading to an increase in price.
At the time of writing, Dogecoin isn't especially bullish—however, it isn't bearish either.
Dogecoin’s performance
The memecoin is trading with a 1.7% price increase in the last 24 hours before press time and a 4.6% decline in the previous week.
According to the charts, the memecoin is trading within a descending wedge and is holding on to the $0.0933 support pretty well, as shown.
Dogecoin’s price action
Source: TradingView
Dogecoin’s price action
This gives the cryptocurrency some much-needed support to push further upwards and retest the 25-day EMA around $0.1.
If we eventually see a break above this crucial (and psychological) $0.1 price level, Dogecoin will be fully poised to continue further upwards and break out of the formation for good.
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