Dogecoin IOMAP model

The largest and most popular meme coin has gained considerable momentum following rumors of Twitter seeking to integrate crypto payments on the microblogging platform. In addition to accruing 32% in gains in the last 30 days, Dogecoin price increased by 2% in 24 hours to trade at $0.0941 at the time of writing.

With over $1 billion in trading volume posted, Dogecoin price could soon blast past the immediate seller congestion at $0.1. As we will see later in its medium-term and short-term price analysis, most of the applied technical indicators are in line to support a bullish outcome.

Will Twitter Add Support For Dogecoin Payments?

Dogecoin price flipped back in the green following rumors that Elon Musk, the CEO of Twitter intends to integrate cryptocurrency payments on the microblogging platform. According to an article published by the Financial Times, Twitter is seeking regulatory licenses across the United States to support crypto payments.

Similarly, the development team at Twitter is racing against time to build software that will ensure payments are rolled for its users. It is this news that triggered interest in DOGE, as it rallied from $0.084 to $0.0941.

Musk has been known to openly support Dogecoin and in the past, he has even said it’s his favorite cryptocurrency. With him at the helm of the social media company, Dogecoin is likely to be among the first crypto assets to debut on the platform, alongside established coins like Bitcoin (BTC), Ethereum (ETH), and Litecoin (LTC).

The billionaire, who is also the CEO of Tesla, hopes that the introduction of crypto payments on Twitter will ramp up activities like tips for content creators, purchase of goods and services as well as peer-to-peer payments.

Musk has also been pushing McDonald’s to accept Dogecoin payments, a move likely to expose the meme coin to a wider audience. Support for DOGE on McDonald’s could also trigger a rally in Dogecoin price.

Dogecoin Price Flaunts Bullish Weekly Outlook

Investors buying Dogecoin now could be embracing a buy signal presented by the Moving Average Convergence Divergence (MACD) indicator on the weekly timeframe chart. In addition to the MACD line in blue crossing above the signal line in red, the momentum indicator is about to move into the positive region – above the mean line at 0.00.

For Dogecoin bulls to validate a long-term uptrend, they must push the price above an immediate hurdle at $0.0976, as highlighted by the 50-day Exponential Moving Average (EMA) (in red).

DOGE/USD weekly chart

On the downside, Dogecoin needs to keep holding above the 200-day EMA (in purple) as this will build investor confidence in the expected rally above $0.1. Bulls are also required to steady price action for gains above two more key levels: The falling multi-month trendline and the 100-day EMA (in blue). Once these hurdles are in the rear-view mirror, bulls will assume the reins, culminating in a bull market.

The daily chart upholds the bullish narrative for Dogecoin price with the MACD still donning a buy signal and lifting above the mean line. DOGE also sits on top of a solid support area formed by the 50-day EMA, 100-day EMA, and 200-day EMA.

For now, the biggest challenge is the resistance at $0.1 but once cleared, Dogecoin price will tap into a new momentum created from the growing investor interest to close the gap first to $0.16 and possibly stretch the leg to $0.20.

DOGE/USD daily chart

Investors who previously purchased Dogecoin between $0.0966 and $0.0993 confirmed the immense presence of sellers near $0.1. The IOMAP by IntoTheBlock reveals that approximately 18,400 addresses bought 8.02 billion DOGE in the range. Since they are out of the money (and facing unrealized losses), they may close their positions as Dogecoin price rises which could stifle recovery.

Dogecoin IOMAP model

From the same IOMAP model, we can deduce a heavily supported Dogecoin. The green circles represent clusters of investors who purchased DOGE at various zones. Addresses in these clusters are in the money or witnessing unrealized profits. Such investors would be willing to throw their weight behind a Dogecoin price rally as opposed to letting declines take over.

On the other hand, investors must consider the declining trend in the number of active addresses on the network. Insight from IntoTheBlock shows a sharp drop from 91,170 active addresses on January 30 to 68,890 addresses recorded on February 1.

Dogecoin Active Addresses

The reason for this drop remains unknown, considering Dogecoin price has gained momentum over the last couple of days. Nevertheless, the trend could hamper growth in the coming days and that’s why investors are cautioned to tread carefully.

Buy Dogecoin Now

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