Crypto analyst Ali Martinez (@ali_charts) has shed light on a potential trend reversal for Dogecoin, revealing that the popular memecoin has issued a bullish technical signal on its daily chart. According to Martinez, the TD Sequential indicator presented a “buy signal,” suggesting a price rebound may be on the horizon.
Dogecoin prints TD9 buy signal
The shared chart – covering the daily candlesticks of the DOGE/USDT pair – illustrates 10 days of downward price action. Dogecoin has pulled back from previous highs near $0.4843 to trade at around $0.32, losing around -35% over the past few days. The most recent candle on the chart is a long black (bearish) bar, reflecting notable selling pressure that has pushed prices towards $0.3200.
“TD Sequential shows a buy signal on the Dogecoin daily chart, anticipating a price rebound!” Martinez job via X. At the heart of Martinez’s observation is the TD Sequential, a widely respected technical tool among seasoned traders. Developed by market technician Tom DeMark, the TD Sequential aims to identify price exhaustion points and potential reversals in ongoing trends. It works by counting a series of consecutive candles in one direction.
Related reading
The indicator generally monitors up to nine consecutive bearish or bullish candles. When a number nine is reached during a persistent downtrend, it often signals a possible bullish turn, known as a “TD9 buy signal.” Conversely, nine consecutive higher closes in an uptrend can signal a potential bearish reversal.
In larger setups, the indicator may continue to count up to 13, providing additional confirmation, but the “9” signal itself often attracts traders’ most immediate attention. On this Dogecoin chart, the number TD9 has just appeared, meaning the daily downtrend could reach a point of interest for buyers. After a “9” candle, the sequence restarts at “1”, which may suggest the start of a new bullish configuration, if future candles confirm the reversal.
Price Levels to Watch
The most crucial support zone lies at $0.313, the 0.382 Fibonacci retracement level on the daily chart. Maintaining a daily close above this level could strengthen bullish momentum if buyers respond to the TD9 signal. Any attempt to bounce will likely face initial resistance around $0.3400, where the downtrend line lies. A decisive break above this (black) line could validate the anticipated trend reversal.
Related reading
Although no longer out of reach, regaining ground in the $0.4000 region ($0.5-0.395 Fibonacci level) would be a stronger sign that Dogecoin has recovered from its downward spiral. Overall, Dogecoin is at a crucial place. The TD Sequential’s “buy” setup does not guarantee instant upside, but it historically serves as a reliable early warning of trend fatigue.
If bullish traders capitalize on this signal, Dogecoin could stage a price recovery towards mid-range resistances. On the other hand, failing to maintain the $0.3100 zone could prolong the current bearish cycle.
Featured image created with DALL.E, chart from TradingView.com