Dogecoin Price Expected to Rally Before Potential Crash: What's the Prediction?

Dogecoin

Summary:
The price of Dogecoin (DOGE) has been under pressure in the currently bearish cryptocurrency market. Analysts suggest while there could be a brief price rally ahead, a substantial crash may follow based on technical indicators and current market sentiment.

Key Takeaways:

Dogecoin's price is struggling below the $0.15 support level.
A bearish flag pattern indicates further declines may be imminent.
Analysts predict a potential initial rally to around $0.2 before a significant drop to $0.05.
The price movements heavily depend on broader market conditions.

Current Dogecoin Market Dynamics

The price of Dogecoin is facing challenges amidst the prevailing bearish trends in the cryptocurrency market. After initially dropping to $0.2, bulls attempted to stabilize support levels and initiate a rebound. Unfortunately, due to the ongoing bearish pressures of this fourth quarter, Dogecoin has since dropped below the critical $0.15 support level, demonstrating continued weakness.

Notably, crypto analyst Weslad warns that the worst may still be ahead for Dogecoin. He highlights the appearance of a corrective structure on the coin's price chart, leading to a bearish flag pattern. Given these technical indicators, investors are cautioned about the potential outcome, including a significant price decline as the situation unfolds.

Potential Price Movements for Dogecoin

In an analysis shared on TradingView, the bearish flag is interpreted as a precursor to future price movements. Weslad elaborates that this pattern has already instigated a breakdown in Dogecoin's price, causing a downward trend. Consequently, negative sentiment has prevailed, suggesting further declines are likely.

Despite this, Weslad noted that Dogecoin’s price remains below its breakout zone, implying there may be a brief relief rally ahead. If this scenario materializes, it’s predicted that Dogecoin could initially drop below $0.12, creating a support level above $0.118. With this support established, an upward momentum could lift Dogecoin back to the $0.2 mark.

Dogecoin price
Source: TradingView

Once this anticipated move occurs, the analyst foresees a more significant crash on the horizon. According to Weslad's chart analysis, from the $0.2 threshold, Dogecoin's price might plummet by another 70%, potentially dropping to around $0.05 and returning to its two-year lows.

“The immediate focus is to observe a pullback towards the minimum targets of the bearish flag, near the $0.12 level, which coincides with previous support and breakout zones,” commented Weslad. This lower range could act as a “supply on the retest,” setting the stage for the next price decline.

At present, the analyst anticipates that Dogecoin's price will likely continue on its bearish trajectory, which is significantly influenced by the overall market performance. So far, a breakdown appears more probable.

Dogecoin price chart from Tradingview.com
DOGE bears push price lower | Source: DOGEUSDT on Tradingview.com