Dogecoin‘s DOGE/USD decline has left traders debating whether there is any short-term hope left for the meme coin.
What Happened: Dogecoin has been moving inside a giant descending triangle, a pattern known for generally bearish implications.
The base of this triangle has provided robust support for DOGE, being tested three times already as stated by Crypto Daily Trade Signals. With DOGE trending below both the 50-day and 200-day simple moving averages (SMA), the market sentiment is largely bearish. However, "If a bounce happens, DOGE may break out of the current market structure and head for $0.237."
If the bounce occurs, resistance levels are anticipated around $0.182 and $0.206, while downside risks point to support levels at $0.096 and $0.072. "Descending triangles are generally not bullish, but if they resolve upwards, it's usually explosive."
Trader Tardigrade indicated that the meme coin is at the "last phase of consolidation, a triangle consolidation." He added that such triangles had been noticed in every phase before the huge surge. He foresees that it could replicate previous cycle patterns and experience a substantial surge following this consolidation phase.
Crypto trader TheCryptoBull tweeted that the next target could be $1.69.
Also Read: Dogecoin, Shiba Inu, Pepe Crash Over 10%: ‘There Are No Blue Chips’ Among Memes, Warns Trader
Why It Matters: IntoTheBlock data shows a 38.9% increase in large transaction volume and a 4.9% increase in daily active addresses. Transactions greater than $100,000 more than doubled from 121 transactions on June 16 to 366 transactions on June 17. Total exchange inflows spiked from $5.7 million to $37.3 million.
The general bearish conditions of the market, heavily influenced by Bitcoin's performance, raise concerns about Dogecoin's performance.
As DOGE teeters on the edge of this descending triangle pattern, traders are split between an explosive upward breakout and a further decline. Much hinges on whether the strong support holds and how the broader market conditions evolve.
What’s Next: The influence of Bitcoin as an institutional asset class is expected to be thoroughly explored at Benzinga’s upcoming Future of Digital Assets event on Nov. 19.
Read Next: Is $0.10 Really Dogecoin’s ‘Next Stop’?
This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
Image: Shutterstock
© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
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