TLDR
- Dogecoin has formed a concerning Double Top pattern on technical charts, with price declining over 32% in the past month to $0.25
- Technical analyst ‘MelikaTrader94’ predicts DOGE could drop to support levels at $0.22 (S1) and potentially $0.176-$0.18 (S2)
- The Relative Strength Indicator shows bearish divergence, suggesting weakening buying momentum
- A connecting bearish trend line is forming with resistance at $0.2560, while major support exists at $0.2420
- Contrary signals exist – analyst Ali Martinez notes a TD Sequential buy signal on the 4-hour chart indicating potential rebound
The cryptocurrency market is closely watching Dogecoin (DOGE) as the popular meme coin forms a technical pattern that could indicate future price movement. The digital asset is currently trading at $0.25, marking a 32% decline over the past month and raising questions about its short-term trajectory.
Recent technical analysis reveals the formation of a Double Top pattern on Dogecoin’s price chart, a development that has caught the attention of traders and analysts. This pattern, characterized by two consecutive price peaks with a valley between them, typically suggests potential downward pressure.
TradingView analyst ‘MelikaTrader94‘ has identified two crucial support levels that could come into play if the bearish scenario unfolds. The first support zone (S1) sits at $0.22, while a second, more critical support level (S2) exists between $0.176 and $0.18.
Adding to the technical picture, the Relative Strength Indicator (RSI) is displaying a bearish divergence. This occurs when price makes a higher high while the RSI registers a lower high, often interpreted as a sign of weakening buying momentum in the market.
#Dogecoin $DOGE could be gearing up for a rebound, as the TD Sequential indicator flashes a buy signal on the 4-hour chart! pic.twitter.com/HiYJ7iVCP8
— Ali (@ali_charts) February 17, 2025
The past 24 hours have seen DOGE decline by more than 4%, with the weekly losses extending to 5.5%. This continuous downward pressure has positioned the asset below several key technical levels, including the 100-hourly simple moving average.
A connecting bearish trend line has formed with resistance at $0.2560, creating another hurdle for any potential recovery attempts. The immediate resistance zone extends to $0.2600, a level that bulls need to overcome to establish any meaningful upward momentum.
However, not all technical indicators are pointing downward. Crypto analyst Ali Martinez has noted that the TD Sequential indicator has flashed a buy signal on the 4-hour chart, suggesting the possibility of a price rebound.
Market Analysis
The hourly chart shows that Dogecoin has already attempted a recovery from its recent low of $0.2420. The price managed to move above the 23.6% Fibonacci retracement level of the downward wave that started from the $0.2830 swing high.
If buyers can push the price above $0.2620, which represents the 50% Fibonacci retracement level, it could open the path toward the $0.2670 resistance zone. A breakthrough above this level might encourage further buying, potentially leading to a test of the $0.300 mark.
On the downside, immediate support exists at $0.2480, followed by the recent low at $0.2420. A breach below these levels could accelerate the decline toward $0.2350, which serves as a major support zone.
The MACD indicator on the hourly timeframe shows decreasing bearish momentum, although it remains in the negative zone. This suggests that while selling pressure persists, it may be losing strength.
Trading volume has remained relatively stable during this period of price uncertainty, indicating that major market participants are currently in a wait-and-see mode as they assess the validity of the Double Top pattern.
Market observers note that the completion of the Double Top pattern would require a decisive break below the pattern’s neckline, which could then trigger the projected move toward lower support levels.
The current price action comes amid broader market movements, with Dogecoin following similar patterns seen in other major cryptocurrencies. However, DOGE has shown its own unique technical setup that traders are monitoring closely.
The most recent price data shows DOGE consolidating around the $0.25 level, suggesting that market participants are carefully weighing the various technical signals before making their next moves.
