Should you buy Dogecoin amid recent weakness

• Dogecoin price on Tuesday edged slightly higher to recoup losses of the last five days.

• The DOGE/USD price plummeted more than 17% late last week after hitting a new 2-month high.

• The fun-oriented open-source digital currency now has a fully-diluted market cap of $36.6 billion.

On Tuesday, Dogecoin (DOGE/USD) price edged slightly higher to trim last week’s losses. The fun-oriented open-source digital currency spiked last week to trade at about $0.34, a new 2-month high, before pulling back through Monday.

However, it bounced back slightly on Tuesday surging from 0.26 to trade closer to 0.28 despite trading volume falling 26.65%. Dogecoin is an internet meme crypto created in December 2013 from Litecoin. 

Creators Billy Markus and Jackson Palmer wanted to make a fun, light-hearted cryptocurrency for crypto enthusiasts. It has since grown to become one of the biggest in terms of market capitalisation.

Why it could be time to buy DOGE

From an investment perspective, Dogecoin seems to have recently pulled back after finding the trendline resistance. As a result, it has moved closer to the 100-day moving average, creating an opportunity for a rebound.

Therefore, investors could target potential rebound profits at about $0.31 or higher at $0.34. On the other hand, if the pullback continues, Dogecoin could find crucial support at about $0.24, or lower at $0.20.

In summary, Dogecoin seems to be trading within an ascending channel formation, indicating a significant bullish bias in the market sentiment. Therefore, the recent pullback presents an exciting opportunity for investors to buy.

DOGE is yet to hit overbought conditions, thus supporting a continuation of the trend.