Dogecoin (DOGE) Price Breakdown Fears Escalate Due to Bearish Pattern

5 December 2022, 15:00 GMT+0000
Updated by Geraint Price
5 December 2022, 15:00 GMT+0000
In Brief
  • DOGE is facing resistance at $0.105
  • It is trading inside a short-term ascending wedge
  • The short-term RSI is bearish
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The Dogecoin price is looking bearish in the short-term, since DOGE is trading inside a bearish pattern. Technical indicators are showing weakness, supporting the possibility of a breakdown.

The Dogecoin (DOGE) price has increased since Nov. 9. It created a higher low on Nov. 21 and accelerated its rate of increase afterward. On Nov. 27, the DOGE price broke out from an ascending parallel channel. It resumed its increase and reached a high of $0.111 on Dec. 5.

An Elon Musk shoutout may have aided the increase. The new Twitter CEO reaffirmed his support for the meme coin, answering “Dogecoin to the moon” when asked whether Twitter will allow crypto payments.

However, the upward movement has stalled since the breakout. During the past 24 hours, the Dogecoin price created a long upper wick, considered a sign of selling pressure.

Additionally, the RSI has generated bearish divergence. The fact that the divergence is present at the 0.382 Fib retracement resistance at $0.105 increases the bearish Dogecoin forecast.

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Due to these readings, the DOGE price prediction is considered bearish. A fall back inside the channel would confirm this possibility.

Dogecoin (DOGE) Price
DOGE/USDT Six-Hour Chart. Source: TradingView

Dogecoin Price: What Happens After Breakdown?

The technical analysis from the short-term four-hour chart also provides a bearish outlook. This is because the Dogecoin price is trading inside an ascending wedge, which is considered a bearish pattern. This goes in line with the bearish divergence in the RSI. 

If a breakdown occurs, the closest support area would be between $0.087 and $0.091. This is created by the 0.5-0.618 Fib retracement support levels. 

However, if the entire movement since Nov. 9 is an A-B-C corrective pattern, the Dogecoin price could fall all the way to the next support at $0.060.

As a result, the DOGE price is considered bearish. A decisive close above $0.105 would invalidate this bearish forecast.

DOGE Price Wedge
DOGE/USDT Four-Hour Chart. Source: TradingView

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Disclaimer

BeInCrypto strives to provide accurate and up-to-date information, but it will not be responsible for any missing facts or inaccurate information. You comply and understand that you should use any of this information at your own risk. Cryptocurrencies are highly volatile financial assets, so research and make your own financial decisions.