An analyst explained that if Dogecoin wants to avoid a 30% price drop, it must stay above this level.
Dogecoin is currently trading within a symmetrical triangle, with a doubt--Public Account: Feng Baobao is roasting sweet potatoes
In a new article on platform X, analyst Ali Martinez shared a chart showcasing Dogecoin's current trend from a technical analysis (TA) perspective. The chart below displays the price trend of Dogecoin over one day.
It seems that the token's price is currently retesting the lower line of the triangle |
From the chart, it can be seen that Dogecoin's price may have been fluctuating within a triangular channel over the past few months. This channel is not an ordinary triangle but a special type known as a 'symmetrical triangle.'
A symmetrical triangle forms when the asset's price consolidates between two trend lines, which have roughly equal slopes but opposite directions. The upper line of this pattern tracks the lower highs, while the lower line tracks the higher lows.
As the asset fluctuates within this channel, its range of motion will narrow over time until it contracts to a point. Typically, when the consolidation tightens, volatility is more likely to occur, so as the price approaches the tip of the triangle, the possibility of breaking through this pattern will increase.
A breakout from a symmetrical triangle may signal that the trend will continue in the direction of the breakout. This means that breaking out of this pattern may indicate a bullish signal, while breaking down may signal a bearish signal.
As shown in the figure, Dogecoin's daily price has recently approached the tip of the triangle, which may indicate an imminent breakout. Currently, this meme coin is retesting the lower line, so it will be very interesting to observe whether this level can hold or if it will ultimately break through.
Unlike the other two common types of triangular channels in technical analysis—ascending triangles and descending triangles—symmetrical triangles are generally considered to have an equal probability of breaking in either direction. The reason is simple: in this pattern, the consolidation is entirely horizontal. In contrast, ascending and descending triangles slope upwards and downwards respectively, which may affect the direction of the breakout.
Therefore, even if Dogecoin is currently retesting the lower line, the possibility of a rebound and breaking through the upper line is still quite high. Even so, if a bearish breakout does occur, Dogecoin's situation could be particularly concerning, as there is another important resistance level nearby.
