In a noticeable turn of events, meme coin Dogecoin is now signaling an impending correction after a 30% surge in seven days.

Dogecoin price has took part in an unprecedented rally in October, surprising many investors who had been on the sidelines until now. However, according to crypto analyst Ali Martinez, the meme coin may actually undergo some price correction in the compact term before continuation of the upward trend.

His insights are based on the signal provided by the TD Sequential Indicator, a technical tool known for identifying market exhaustion points.

Dogecoin may be redeemed

In last post on XMartinez highlighted the TD Sequential setup on the Dogecoin/TetherUS daily candlestick chart. This analysis shows that Dogecoin is currently experiencing its ninth consecutive bullish close on the daily candlestick, which coincides with the ninth reading of the TD Sequential indicator. While this continued rise in Dogecoin’s price is impressive, it also indicates that the meme coin may be reaching a key point where price retracement could occur.

Moreover, this sell signal coincides with Dogecoin’s newly established overbought condition. The Relative Strength Index (RSI) showed that recent buying momentum has pushed Dogecoin deep into overbought territory.

At the time of writing, RSI 14 is trading at an elevated level of 75.80 and has recently touched a high of 78.36, which is the highest level since March. An overbought condition suggests that the buying frenzy may be unsustainable, making a rapid pullback more likely.

Is it time to sell DOGE?

Martinez’s observations are an critical reminder of Dogecoin’s volatility ahead of the novel week. At the time of analysis, the price of Dogecoin was $0.14575. However, as of this writing, Dogecoin has fallen to $0.1424, down 2.3% in a matter of hours. Despite this, the meme coin has still gained 29% in the last seven days.

Nevertheless, it is extremely critical to remain patient with Dogecoin’s forecasts, especially since the RSI is currently indicating an overbought condition. On the other hand, Dogecoin is not the only cryptocurrency in an overbought state, as according to the Fear and Greed Index, the entire market is currently in a state of greed.

If the 24-hour correction for DOGE were to extend into the end of the weekend, it could result in a cascading break below $0.14 and back to the $0.13 area in the compact term.

Crowd attention and discussions around Dogecoin remain unchanged highest level since March. This suggests that any corrections may be fleeting and there is a good chance of the uptrend resuming as the novel week approaches. According to one crypto analyst, Dogecoin is on the right track to price increases with a rate of return exceeding 400%.

Featured image from Medium, chart from TradingView