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Dogecoin (DOGE) is currently trading at $0.102, but the popular meme-based cryptocurrency appears to be positioning itself for a potential move to the upside. Over the past five months, Dogecoin has largely traded in a downtrend with the formation of lower highs and lower lows. This consistent downward pressure has led to the development of a classic price pattern known as a falling wedge.
According to a technical analyst who has been closely tracking Dogecoin’s movements, the daily chart suggests that the falling wedge is nearing its conclusion, and a bullish breakout is now in sight. If Dogecoin successfully breaks out of this wedge, the analyst projects a price target of $0.20.
Dogecoin Falling Wedge Breaking Bullish
A falling wedge is a narrowing price channel that typically signals a reversal from bearish to bullish momentum. The key feature of this pattern is that it shows a gradual reduction in the downward price movement as buyers start to step in, causing price consolidation. In the case of Dogecoin, this pattern was highlighted by a technical analyst known pseudonymously as Crypto Yapper on social media platform X.
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According to the DOGE/USDT chart on the 1D candlestick, DOGE has largely been on a downtrend since it peaked at its yearly high of $0.22 in March. At one point, DOGE fell by 63% from $0.22 to a low of $0.08 on August 5. Following this low point in early August, Dogecoin has managed to stage a modest recovery, rising by approximately 25% to its current level. However, DOGE has yet to break above the upper resistance trendline of the falling wedge pattern.
$DOGE almost Breaking Out !
This Falling Wedge on the #DOGE daily chart is close to breaking Bullish
The break out target for #Dogecoin will be $0.20 pic.twitter.com/MoAQe1Xo6r
— Crypto Yapper (@CryptoYapper) September 14, 2024
Since bouncing off $0.088 on September 6, DOGE has traveled upwards to retest the upper trendline of the falling wedge at around $0.108. As noted by Crypto Yapper, a successful break to the upside would see DOGE doubling its current value and reaching $0.20.
While this price target might seem modest at first glance, especially considering that Dogecoin had already surpassed $0.20 earlier in the year, it represents the cryptocurrency’s recovery from its prolonged downtrend. This, in turn, could lead to a total change into bullish sentiment, with DOGE eventually breaking above $0.22.
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Echoing the falling wedge pattern analysis is another DOGE trader (CryptoHotep). According to him, DOGE at $0.10 is a gift. His post featured a similar DOGE/USD price chart featuring the falling wedge pattern from $0.22, albeit with the upper trendline only.
This comment was made regarding a forecasted breakout above the upper trendline. Although there wasn’t a projected price target, his comment showed this is probably the best time to buy DOGE before the projected breakout.
Featured image created with Dall.E, chart from Tradingview.com
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