Well-known analyst DonAlt recently described Dogecoin's chart as destructive, claiming that traders' net assets have been significantly impacted by the sideways fluctuations over the past month. The analyst asserts that attempts to ride the speculative wave to push the price up to $1 have led to a large number of leveraged positions being liquidated.
According to the daily chart, Dogecoin has shown prolonged sideways consolidation within the $0.38 to $0.48 channel. Over-leveraged traders expecting a rapid breakout may find this consolidation difficult to navigate, although it is not always detrimental.
The DOGE/USDT chart on TradingView highlights the dangers of speculative trading due to a lack of clear price action, with long positions failing. Whether Dogecoin will reach $1 remains a speculation. Dogecoin's significant past increases have been more driven by social momentum and hype rather than solid technical or fundamental advancements. Without major catalysts, breaking through its recent resistance around $0.48 may be challenging.
Before reaching higher goals, if Dogecoin can regain momentum and test its previous high, $0.50 may become a key resistance level. After briefly dipping below $0.39, Dogecoin is trying to stabilize around this level on the four-hour chart. If this support holds, the upper boundary of the channel may be retested in subsequent movements. With $0.31 being a key support level, a drop below $0.39 could lead to further sell-offs.
Although the current situation seems detrimental for traders interested in short-term trades, it also provides opportunities to accumulate during consolidation. Long-term investors should monitor the overall market sentiment and any potential triggers that could push Dogecoin towards its speculative $1 target. Given the uncertainty of Dogecoin's movements during the consolidation phase, patience appears to be the best approach at the moment. Addressing this uncertain situation requires careful risk management and avoiding excessive leverage.