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From yesterday’s low at $0.00192 the price of Dogecoin has increased by 11.42% today as it came up to $0.00214213 at its highest point today. Since the high, the price has started moving to the downside and is currently sitting at $0.00205292.
The price is just below the most significant resistance line which was the horizontal support level seen a higher time-frame
Looking at the hourly chart we can see that the price has fallen below it on January 10th below which a sideways correction took place. Now that the price action created a short-term bottom we are seeing a recovery attempt to the upside.
This would be the Y wave according to my count as we are most likely seeing a correction to the upside before the price is set to continue its downward trajectory.
As I have counted the sub-wave I believe that the price is set to go higher from here as a five-wave move to the upside should fully develop which would bring the price of Dogecoin above its significant resistance level, but much like it did last time I would be expecting a quick spike before another decline below it.
The price target for the expected increase would be around the vicinity of the prior high or the ending point of the W wave at $0.0027796 level but considering that the X wave made it lower than the beginning point of the W wave, we could expect the Y wave to develop slightly lower then the mentioned high.
Zooming out to the daily chart you can see the significance behind the mentioned resistance level and that it was serving as support since the price entered the upper range on a bullish momentum in December 2017.
Now that the level got broken we are most likely going to see the next in line to the downside interacted with out of which the first one is at $0.0014474 and the second is at $0.0006125.
As the price entered the support zone further retest of its support levels would be the next logical step for the price progression and since we are now seeing the price in an upward trajectory the interaction with the resistance level or even better a quick spike inside the sellers’ territory would trigger another round of selling and a bearish momentum to the downside needed for the 5th Intermediate wave to the downside to develop.
As you can see from my Elliott Wave count the correction that took place after the all-time high has completed two Intermediate corrections and is near completion of the third one. This could mean that after the expected downfall the price of Dogecoin could end its correction and bottom out around the support levels which served as resistance prior to the all-time high.
The current correction to the upside is the wave 4 according to my count which is why after the 5th wave ends so would the Y wave of the primary count.
The expected downfall might not be the bottom as the WXY correction can get prolonged by two more waves in which case we could see the wave Z pushing the price significantly lower than projected, but more on that in due time.
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