Dogecoin (DOGE) Continues Sinking Despite Forming Bullish Setup. Read CoinChapter.com on Google News
LUCKNOW (CoinChapter.com)— Dogecoin price remained in the red for the third consecutive day on Aug. 15, with the token shedding over 2% to reach a daily low near $0.1014.
Despite recent bullish signals, including a 103.8 million DOGE whale transfer from the exchange to a wallet address on Aug. 13, Dogecoin’s price fell on August 15.
The transfer initially sparked optimism, pushing DOGE to $0.104 with a 25% increase in trading volume. However, the broader market’s bearish momentum has overpowered these gains, dragging DOGE’s price down despite resilient support levels and ongoing whale accumulation.
Now, bulls would likely be pinning their hopes on a bullish technical pattern that the memecoin has formed.
Bullish Pattern Could Help Attract Buyers
Since early March 2024, the DOGE USD pair has been moving inside a bullish technical setup called the ‘falling wedge.’
DOGE price formed a bullish setup with a 141% upside target. Source: Tradingview
The pattern typically indicates that an asset’s price, while in a downtrend, is losing bearish momentum and may be poised for an upward reversal. In the case of a falling wedge, the expected breakout generally follows the prevailing trend, which, in this scenario, is upward.
To estimate the price target for a falling wedge, traders typically measure the widest part of the wedge at its inception. This distance is then projected upward from the breakout point, establishing a potential price target.
A surge in trading volume accompanying the breakout often confirms its validity. Higher volume suggests stronger market conviction, increasing the probability of a sustained price reversal.
Applying these principles to the DOGE USD pair, technical analysis suggests a potential rally of up to 141% from the current price level, targeting a theoretical price near $0.2464. A rally to the upper trendline of the pattern would likely attract more buyers as market participants anticipate a bullish breakout.
DOGE Price Unaffected by Technical Pattern
Dogecoin’s recent price action reflects the increasing bearish pressure surrounding the memecoin. Following an unsuccessful attempt to convert the August 12 spike into a sustained rally, DOGE experienced a nearly 4% decline on August 13, and the downtrend continued from there.
The failure to clear the 20-day EMA resistance near $0.108 highlights the weakness in upward momentum. This resistance level remains a key barrier, and breaking above it is crucial for any potential upward movement toward the 50-day EMA around $0.117.
DOGEUSD daily price chart with MACD.
However, the apparent lack of buying strength suggests that such a move is improbable without a significant shift in market dynamics.
The MACD line (difference of 12-day and 26-day EMA) crossing below the signal line (9-day EMA of MACD line) usually signals a bearish trend, and that’s evident with DOGE’s recent performance. However, the declining red histogram bars, which represent the difference between these two lines, show that the bearish momentum is fading.
The weakening suggests that the selling pressure is losing steam. If the MACD line crosses back above the signal line, it could indicate a potential bullish reversal, but for now, the focus remains on whether the momentum continues to decrease.
If it does, the DOGE USD pair risks a drop to the support levels near $0.097 and $0.091 before recovering.
The post Dogecoin (DOGE) Continues Sinking Despite Forming Bullish Setup appeared first on CoinChapter.
