Dogecoin can’t break through to the north
The daily timeframe shows that DOGE has been trading inside an ascending parallel channel since June 2023.
In December, the price made a bullish breakout from it, reaching a high of $0.108. However, in early January, Dogecoin fell back inside the channel.
Since then, it has made two unsuccessful breakout attempts (red icons), forming the upper wicks. The second bounce came shortly after social media heavyweight X (formerly Twitter) created a dedicated X Payments account, fueling speculation that Musk’s favorite DOGE would be used to make cryptocurrency payments as part of X’s strategy to introduce peer-to-peer functionality. payments on its platform.
Read also: Elon Musk is still interested in Dogecoin. Should we expect DOGE to grow?
Source: TradingView
Daily Relative Strength Index (RSI) is giving bearish signals. It is below the neutral level of 50 and declining (red circle). Both of these signs indicate a downward trend.
DOGE forecast: what will happen to the bearish pattern
Like the daily timeframe, the 6-hour chart gives a bearish outlook. This is due to Dogecoin price dynamics and RSI readings.
The price has been declining below the descending resistance line since the aforementioned December 2023 high. Most recently, on January 21, 2024, the token bounced off this trend line (red icon).
The resistance line combined with the $0.077 horizontal area forms a descending triangle pattern, which is considered a bearish pattern.
The 6-hour RSI also supports the decline as it is below 50 and falling (red circle). A bearish breakout of the full height of the pattern would cause Dogecoin to fall by 27%, bringing the price to the nearest support at $0.058.
Source: TradingView
On the other hand, a bullish break of the short-term descending resistance line could trigger DOGE to rise 14% to the nearest resistance at $0.088.
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