According to U.Today, Dogecoin (DOGE), the most prominent meme cryptocurrency, has developed a head and shoulders pattern, as reported by cryptocurrency trader Josh Olszewicz. This popular reversal pattern is frequently used by traders to predict the onset of a downtrend. The reversal point on the left side of Olszewicz's chart is referred to as 'the left shoulder.' The peak is known as 'the head' of the pattern, while the right shoulder signifies another reversal point, which, along with the left reversal point, forms the neckline. The price of Dogecoin could potentially break the neckline, thus creating a lower low. If this happens, the bearish pattern would be deemed complete.
This price pattern essentially indicates a loss of bullish momentum when the price fails to make a higher high. At the time of writing, Dogecoin is trading at $0.15 on major spot exchanges, down more than 4.2% over the past 24 hours, mirroring the performance of the broader cryptocurrency market.
In other news, Bitcoin, the leading cryptocurrency, briefly fell below the $63,000 level before bouncing back to $63,622. Analytics firm Fitch suggests that a potential Federal Reserve rate cut may be unlikely this year, given recent economic data indicating slowing GDP growth and rising inflation in the U.S. The firm stated that if growth continues to decelerate slowly, but inflation strongly surges in the wrong direction, the prospect of a Fed interest rate cut in 2024 is becoming increasingly unlikely. Futures traders are now pricing in zero rate cuts for 2024, a significant reversal from earlier expectations of three rate cuts this year. This hawkish shift could negatively impact cryptocurrencies, particularly meme coins, as risk assets typically benefit from a loose monetary policy, which does not appear to be on the cards for 2024.
