Dogecoin Leaps! But Here's Why An Even Bigger Move Looks Bound To Come

Dogecoin DOGE/USD spiked up over 5% higher on Sunday after breaking up bullishly from a double inside bar pattern, which Benzinga called out on Friday. The double inside bar pattern also caused the crypto to form a bull flag pattern on the daily chart, which made the move to the upside both more likely and more powerful.

The bull flag pattern is created with a sharp rise higher forming the pole, which is then followed by a consolidation pattern that brings the stock lower between a channel with parallel lines.

• For bearish traders, the "trend is your friend" (until it's not) and the stock may continue downwards within the following channel for a short period of time. Aggressive traders may decide to short the stock at the upper trendline and exit the trade at the lower trendline.
• Bullish traders will want to watch for a break up from the upper descending trendline of the flag formation, on high volume, for an entry. When a stock breaks up from a bull flag pattern, the measured move higher is equal to the length of the pole and should be added to the lowest price within the flag.

A bull flag is negated when a stock closes a trading day below the lower trendline of the flag pattern, or if the flag falls more than 50% down the length of the pole.

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The Dogecoin Chart: Dogecoin’s bull flag pattern was created between March 22 and Saturday, with the pole of the pattern formed over the first three trading days of that range and the flag created over Friday and Saturday. The measured move of the pattern is about 20%, which indicates the crypto could trade up over the 15-cent mark with sustained momentum.

• Dogecoin is also trading in a strong uptrend, with the most recent higher low printed at the $0.127 mark on Friday and the most recent higher high created on Sunday. Eventually, Dogecoin will need to print another higher low above Saturday’s low-of-day, which could give traders and investors a solid entry point.
• The move higher on Sunday came on higher-than-average volume, which indicates there is a high level of trader and investor interest in the Dogecoin. By early afternoon, Dogecoin’s volume was measuring in at about 296 million, compared to the 10-day average of 266 million.
• If Dogecoin closes the 24-hour trading session near its high-of-day price, it will print a bullish Marubozu candlestick pattern, which could indicate higher prices will come again on Monday. If the crypto closes the trading session near or below the 14-cent mark, the daily candlestick will have a long upper wick, which could indicate the next higher low is in the cards for the following day.
• Dogecoin has resistance above at $0.146 and the 16-cent level, and support below at $0.135 and just above the 12-cent area.