Dogecoin has formed a “monster falling wedge” pattern, potentially signaling a bullish reversal from current $0.20-$0.21 levels
DOGE price dropped over 6% in 24 hours amid broader market downturn and Trump’s EU tariff announcement
Network activity has decreased significantly from 1.29 million addresses in November to just 30,815 currently
Technical analysts are divided, with some predicting a drop to $0.14 while others see potential recovery to $0.45
TD Sequential indicator has flashed a buy signal, suggesting Dogecoin may be approaching a reversal point
Dogecoin’s price has fallen to approximately $0.20, marking a 6% decline in the last 24 hours. The popular meme cryptocurrency is currently trading in a pattern that some analysts believe could lead to a recovery. This drop comes amid a broader market downturn that has seen Bitcoin drop below $84,000.
The price movement coincides with what technical analysts call a “monster falling wedge” pattern. This pattern shows Dogecoin’s price moving between two converging trendlines—one descending from recent swing highs, and another descending at a shallower angle from short-term lows. The pattern is visible on the daily DOGE/USDT chart on Binance.
Crypto analyst Satoshi Flipper highlighted this pattern in a recent post on X. According to technical trading principles, a falling wedge is often viewed as a potential bullish reversal signal. This happens when sellers become exhausted and buyers step in near the wedge’s support line.
The current support level at $0.20 is being closely watched by market participants. If Dogecoin can maintain this level, analysts suggest it could rebound toward targets of $0.30, $0.37, and potentially as high as $0.45 in coming weeks. However, breaking below this support could lead to further declines.
Network activity on Dogecoin has decreased dramatically in recent months. Data shows new address creation has dropped from 1.29 million in November to approximately 30,815 currently. This reduction in new addresses indicates lower investor participation in the network.
Lower investor engagement typically weakens buying pressure. This reduction in network activity aligns with the price decline, as fewer active participants often correlates with downward price movement. The sharp drop in new addresses is one of the fundamental factors behind the recent price weakness.
Macro Issues
Market sentiment has been further impacted by U.S. President Donald Trump’s announcement of a 25% tariff on European Union imports. “We have made a decision, and we’ll be announcing it very soon. It’ll be 25 per cent,” Trump stated during a cabinet meeting, as reported by the Financial Times.
This announcement raised concerns about potential trade tensions between the United States and European Union. Global markets reacted to this economic uncertainty, with cryptocurrencies being particularly affected. Bitcoin’s drop below $84,000 dragged down the broader crypto market, including Dogecoin.
Technical Indicators
Technical indicators are giving mixed signals about Dogecoin’s future price movement. According to crypto analyst Ali, the TD Sequential indicator has flashed a buy signal on the daily chart. This indicator is commonly used to identify potential trend reversals in the market.
Trader Tardigrade pointed out that DOGE’s price action resembles patterns from the 2017-2018 bull run. If history repeats, Dogecoin could experience a strong rally in the near future. Some optimistic projections suggest movement toward the $1.70 level in a bullish scenario.
Analyst Master Kenobi noted that Dogecoin is holding above a critical trend line that has historically acted as support. He also mentioned that Dogecoin’s Relative Strength Index (RSI) is at its lowest level since March 2023. Low RSI values can indicate that selling pressure is easing, potentially setting the stage for recovery.
Not all analysts share this optimistic outlook. Carlos Garcia Tapia cautioned that he sees “h patterns everywhere” and suggested a potential retracement before another downward movement. His prediction places Dogecoin at around $0.14 in the near term, representing a further 30% decline from current prices.
Another analyst, Suzzy, offered a more positive perspective. She noted a strong wick off the $0.19-$0.20 support zone, which she interpreted as a bullish signal. “Buyers are stepping in, and if we see a green candle next, DOGE could be heading toward $0.25+ soon,” she stated on social media.
Took a glance at $DOGE, and I just spotted a strong wick off the $0.19 – $0.20 support, giving me serious bullish vibes!
Buyers are stepping in, and if we see a green candle next, $DOGE could be heading toward $0.25+ soon.pic.twitter.com/bWPQNLrlzS
Investor interest in Dogecoin may be revitalized by growing speculation about a potential Dogecoin ETF. Recent reports indicate that Grayscale Investments, CoinShares, and WisdomTree have submitted ETF filings in recent days. These institutional movements could impact future price action.
Dogecoin’s historical price patterns show that it often experiences corrections before rebounding. Analyst Bithereum noted that the current price movement follows familiar cycles seen in previous years. This cyclical behavior suggests the current dip may be temporary rather than a long-term trend reversal.
At press time, Dogecoin was trading at $0.20635, hovering just above the key support level. Traders are watching for either a decisive break above the wedge’s top boundary or a drop below current support levels to determine the next major price movement.
This articles is written by : Nermeen Nabil Khear Abdelmalak
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(@SuzzyDefi) February 26, 2025