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- According to “ali_charts” on X, Dogecoin is set for a spike in volatility, following a Bollinger band squeeze.
- Ali showed that the indicator is experiencing its tightest squeeze since October 2023.
- The Bollinger bands squeeze coincides with a potential breakout from a descending triangle on Dogecoin’s daily chart.
According to “ali_charts” on X, a renowned technical and on-chain crypto analyst, Dogecoin is set for a spike in volatility. In a recent post on X, Ali highlighted a significant signal in the Bollinger bands indicator on DOGE’s four-hour chart. He showed that the indicator is experiencing its tightest squeeze since October 2023.
The Bollinger Bands on #Dogecoin four-hour chart are experiencing the tightest squeeze since October 2023, signaling an impending spike in $DOGE price volatility. pic.twitter.com/ynQNXVfhxI— Ali (@ali_charts) February 4, 2024
Ali attached a historical chart of the DOGE/USD pair, showing how the flagship meme coin rallied after the October Bollinger bands squeeze. He showed that DOGE surged from a $0.0569 low in a sustained rally for two months. DOGE gained almost 90% during the rally after climbing to $0.1075 by December 2023, according to data from TradingView.
The current Bollinger bands’ squeeze on Dogecoin’s four-hour chart coincides with a sideways movement on the meme coin’s daily chart, according to TradingView’s data. The top meme coin has moved along horizontal support around the $0.0772 price level since the beginning of the year.
In addition to the horizontal support, a downward trendline from the December 2023 high formed a resistance above DOGE’s price, which has been acknowledged since the beginning of the year. A combination of the downward trendline and horizontal support formed a descending triangle nearing a breakout on Deogecoin’s daily chart.
DOGE/USD Daily Chart on TradingView
The current chart formation on Dogecoin’s daily chart, combined with the Bollinger bands squeeze identified by Ali, signifies impending price volatility following historical patterns. It also suggests an exhaustion in the downward momentum that has pushed DOGE’s price down by 30% since reaching $0.1075 last December.
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