Dogecoin price rose for the second consecutive day as the crypto market rally resumed after the release of the CLARITY Act and the soft consumer inflation report. DOGE rose to a high of $0.1485, its highest level since January 7, and technicals suggest it has more upside.
Why DOGE is Soaring
The token is rising because of the ongoing crypto market rally, which has affected Bitcoin and other altcoins. Bitcoin jumped above the key $95,000 resistance level for the first time in months. Other top meme coins like Pepe and Shiba Inu have also soared.
There are four main reasons why this rebound is happening. First, this is the January Effect, a phenomenon in which financial assets perform well in the first few days of the year.
Second, the coin is rising as US inflation softens, with the core Consumer Price Index (CPI) falling from 2.7% in November to 2.6% in December. This decline will likely continue as key prices, such as gasoline and mortgage rates, tumble.
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Third, the rise is because of the upcoming vote on the CLARITY Act, which will simplify crypto regulations. DOGE ETF inflows have jumped by over $4 million this year.
Dogecoin Price Technical Analysis Points to More Upside
The daily timeframe chart shows that the DOGE price formed a giant falling wedge pattern between October and January 1. This pattern consists of two down-sloping, convergent trendlines. The rebound happened when the two lines neared their convergence.
The coin also rebounded after it formed a bullish divergence pattern. This pattern typically occurs when the Relative Strength Index (RSI) and the MACD indicators rise while the price falls.
Most recently, the coin formed a bullish flag pattern, consisting of a vertical line and a descending channel. This pattern often leads to more upside over time.
The coin has moved above the 50-day Exponential Moving Average (EMA), a sign that bulls are now in control. It has also moved above the Supertrend indicator and entered the third phase of the Elliot Wave, which is usually the longest.
Therefore, the token will likely continue rising as bulls target the 38.2% Fibonacci Retracement level at $0.1910. This price is nearly 30% above the current level.
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