Warning signs are flashing as the Dogecoin Bearish indicator suggests a potential 40% decline. Cryptocurrency analyst Josh Olszewicz has once again raised concerns about a potential downturn in Dogecoin’s price.
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Dogecoin Bearish Indicator
Olszewicz’s analysis is centered on the Ichimoku Cloud, a complex indicator that offers insights into support/resistance levels, momentum, and trend direction. His assessment highlights two specific technical patterns on the 1-day (1D) chart of DOGE against the US dollar (DOGE/USD).
Olszewicz pointed out a “bearish TK cross” and a “bearish Kumo breakout.” The bearish TK cross occurs when the Tenkan-Sen (conversion line), a faster-moving average, crosses below the Kijun-Sen (baseline), a slower-moving average. This suggests short-term prices are falling below recent levels, indicating potential further downward movement.
Kumo Breakout
The “bearish Kumo breakout” refers to the price breaking through the Kumo, or cloud, which is formed between two other lines in the Ichimoku Cloud indicator. This breakout confirms a bearish trend, with the Kumo likely acting as resistance to any upward price movement.
Olszewicz’s chart shows DOGE trading at $0.15, with the cloud plotted behind the price action in green above and red below. While a green cloud suggests bullish potential, the price is below both the cloud and the Tenkan-Sen/Kijun-Sen crossover indicating current bearish conditions.
Olszewicz had previously warned of a potential Head and Shoulders (H&S) formation on the DOGE/USD 12-hour chart, with a neckline of around $0.14. If the price breaks below this support level, the H&S pattern could trigger a sell-off towards the $0.10 to $0.09 region, representing a potential 40% decline from the neckline.
H&S Pattern
While the H&S pattern has not been confirmed yet, its presence serves as a cautionary signal. The technical confluence of the bearish TK cross and the bearish Kumo breakout in Olszewicz’s recent analysis reinforces the potential bearish scenario for Dogecoin.
Market participants are advised to closely monitor the $0.14 level, as a decisive break below could validate the bearish outlook and set the stage for the anticipated decline. At the time of writing, DOGE was trading at $0.1413.
https://www.tradingview.com/x/BEJuelR1/
Conclusion
To conclude, Dogecoin bearish indicator as indicated by Josh Olszewicz’s analysis suggests a significant downward pressure with signals such as the TK cross and Kumo breakout. With the potential for a 40% decline looming, traders and investors should exercise caution and closely monitor key support levels, particularly the $0.14 mark, to assess the direction of the market.
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