The Dogecoin price is currently exhibiting a highly bearish chart pattern on the 4-hour time frame, signaling potential caution for investors. After forming a bullish falling wedge pattern between November 12 and 19, the anticipated breakout was short-lived and failed to meet bullish expectations.
On November 19, Dogecoin broke out of the formation, sparking initial optimism among traders. However, crypto analyst Kevin (@Kev_Capital_TA) had predicted the breakout would be weak, and subsequent price movements validated his forecast.
Where Is Dogecoin Price Heading Next?
The memecoin faced a sharp rejection at a significant resistance level, specifically the macro 0.786 Fibonacci retracement level. Kevin emphasized that until this level is โbroken cleanly and violently, thereโs nothing to get overly crazy about.โ He also pointed out that Bitcoin (BTC) is at major resistance, suggesting that Dogecoinโs next significant move will likely coincide with Bitcoin clearing the $100,000 mark. โUntil then, everythingโs just gonna mosey around,โ he noted.
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Urging traders to temper their enthusiasm, Kevin stated, โPlease control your excitement as there is nothing in the short term to be excited about. BTC is still at major resistance and so is Dogecoin. Nothing has broken yet.โ He highlighted the importance of Bitcoinโs movements, adding, โItโs more important to provide technical analysis on BTC than on Dogecoin at the moment. DOGE is just trading sideways, waiting for Bitcoin to make a decision on higher or lower. Where Bitcoin goes, Doge will go in the short term.โ
Analyzing the 4-hour chart, Kevin identified a โnasty triple topโ at the macro 0.786 Fibonacci level for Dogecoinโa bearish signal that could indicate upcoming downward pressure. He warned that if a correction to $0.30 occurs, as he had previously suggested, โa lot of blind perma bulls are gonna need to do some explaining.โ
A triple top is a bearish reversal pattern in technical analysis that signifies a potential shift from an uptrend to a downtrend. It occurs when the price reaches the same resistance level three times, each time retreating after failing to break through. Dogecoinโs repeated inability to surpass the 0.786 Fib at $0.41 suggests weakening bullish momentum in the short term.ย
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Kevin emphasized that Dogecoin hasnโt truly broken out yet: โUntil it breaks the macro 0.786 Fib cleanly at $0.41, itโs just trading sideways.โ Looking ahead, he outlined a bullish scenario contingent on overcoming this key resistance level. โIf Dogecoin breaks that macro 0.786 Fib with force, then $0.80 to $0.85 is on the table. Lots of work to do though. Need BTC to push higher,โ he explained.
For several days, Kevin has been forecasting a deeper correction for Dogecoin. The triple top formation and rejection at the 0.786 Fibonacci level support his primary hypothesis. He outlined his initial price target: โA level we will want to hold for Dogecoin is the $0.30 to $0.26 range, which is the golden pocket retrace levels. Thatโs a 30-40% correction from the local top, which in a bull market is a perfect size correction.โ
Focusing on the longer-term perspective, Kevin highlighted the significance of the upcoming monthly candle close. โThe next big goal for Dogecoin is to close a monthly candle in 11 days above $0.335. That would make the highest monthly candle close of all time for DOGE, and I will be keeping my eye closely on this,โ he stated.
At press time, DOGE traded at $0.39.
Featured image created with DALL.E, chart from TradingView.com
