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Dogecoin Shakeout Could Plunge Price To $0.21 Before A Run To $0.4 Happens

Dogecoin’s recent price action has seen the meme coin trading in a tight range below a resistance zone, currently hovering between $0.21 and $0.26. Over the past week, the meme coin has been hampered at a resistance level around $0.25, which is threatening to send it crashing downwards.

Interestingly, technical analysis suggests that Dogecoin could experience a further shakeout before eventually making a move upwards.

Analyst Forecasts Shakeout To $0.21 Before Breakout To $0.4

According to technical analyst Trader Tardigrade, who shared a breakdown of Dogecoin’s daily chart on social media platform X, the meme coin seems like it is currently forming the second leg of a two-part consolidation structure. Notably, the chart outlines a likely scenario where the price undergoes a short-term dip toward the $0.21 zone before resuming its uptrend. 

This structure, which includes a brief retest of support around $0.21 following an earlier rally in May, is consistent with shakeout patterns designed to remove weak hands before the next bullish impulse. 

Dogecoin

The annotated chart below reveals a previously completed first leg rise from April lows to the current price range, followed by the beginning of a second leg correction. The analyst expects this leg to deepen slightly towards $0.21 again before Dogecoin gains strength to attempt a breakout through the overhead resistance marked just above $0.25. If that move succeeds, the next logical price target, according to Trader Tardigrade, sits around $0.4. a level not seen since January 2025.

Examining The Resistance Zone Between $0.24 To $0.25

The resistance zone around $0.25, highlighted in the chart above with a thick horizontal red bar, represents a reactive area of support turned resistance. Notably, this level acted as much of a support level during Dogecoin’s initial decline in February, before eventually caving in due to the intense selling pressure at the time. That breakdown shifted the market structure, turning what was a safety net into resistance.

Now, as Dogecoin attempts to recover from its April low of $0.13, this $0.25 region has emerged as the primary barrier obstructing the continuation of its rally, with multiple intraday rejections near this level in recent weeks. Breaking through this resistance zone also depends largely on the wider crypto market and inflows into the industry. However, until there’s such confirmation, the technical analysis by Trader Tardigrade suggests a cautious outlook for day traders, especially given the possibility of a flush down to $0.21.

At the time of writing, Dogecoin is trading at $0.2279, up by 2% in the past 24 hours, having recently reached an intraday low of $0.2174. Should the bullish scenario play out from this level, a move toward $0.40 would mark an impressive 85% gain from the current price of Dogecoin.

Dogecoin

from Bitcoinist.com https://ift.tt/pq4tuZ2
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