Dogecoin Price Forms Symmetrical Triangle On Daily Chart, What To Expect If It Breaks Out

Dogecoin is on a notable decline of 11.8% and 20% in the past 24 hours and seven days, respectively, and could retest support at the $0.30 price level soon. Despite this decline, Trader Tardigrade, a well-known technical analyst on social media platform X, has managed to note a symmetrical triangle forming on DOGE’s daily candlestick chart. This classic technical pattern is often a precursor to significant price movements, and a breakout could prompt the resumption of an uptrend.

Dogecoin Forming A Symmetrical Triangle

According to Trader Tardigrade, Dogecoin looks like it has been trading within a symmetrical triangle within the past seven days. This symmetrical triangle formation arose as a result of Dogecoin’s price correction, which started after it reached $0.43 on January 18. 

According to the daily candlestick chart, the majority of candlestick bodies have stayed within the confines of this triangle since January 20. The initial two days of the pattern’s formation saw a few wicks temporarily breaking above the upper trendline, but Dogecoin’s price quickly retreated back into the pattern. Since then, the price has shown a sequence of lower daily highs and higher daily lows, a behavior indicative of waning selling pressure and an equilibrium between buyers and sellers.

The price action has managed to push towards the apex of the triangle, and Trader Tardigrade suggests that a breakout could favor the bulls, pushing the price significantly higher.

What Happens If DOGE Breaks Out of the Triangle?

If Dogecoin manages to break above the upper trendline of the symmetrical triangle, it could signal a resumption of the bullish trend. Trader Tardigrade predicted that this breakout could lead Dogecoin to a price target of at least $0.45.

However, instead of moving upward, Dogecoin has recently broken below the lower trendline of the symmetrical triangle, shifting its trajectory downward toward support at $0.31. This level has proven to be a significant liquidity zone over the 30 days. In fact, $0.31 has served as a reliable support point, with Dogecoin rebounding from this price three times during recent declines. The most notable recovery occurred on January 13, when Dogecoin bounced off the $0.31 level and subsequently surged upward, eventually reaching a high of $0.4318.

Now, the next step is whether DOGE can repeat this pattern by rebounding once again at $0.31. A successful rebound at this critical support level would indicate that buyers are stepping in to defend and give Dogecoin the strength it needs to resume its upward trajectory. If the rebound gains sufficient momentum, it could reestablish confidence in DOGE’s bullish outlook and set the stage for a renewed attempt at breaking the $0.45 price target. Until then, $0.31 remains a key level to watch as the meme coin tests the resolve of buyers.

Featured image from Unsplash, chart from Tradingview.com