Dogecoin Tests Key Fibonacci Level After 35% Drop from $0.48 - Analyst

Dogecoin , a popular cryptocurrency, has shown signs of a potential trend reversal, according to crypto analyst Ali Martinez. He noted that the memecoin has exhibited a bullish technical indicator on its daily chart, suggesting a possible price rebound is near. The TD Sequential, a renowned tool among traders, has flashed a "buy signal," hinting at a shift in momentum.

The DOGE/USDT daily candlestick chart reveals ten days of declining prices. Dogecoin's value has dropped from highs near $0.4843 to around $0.32, experiencing a 35% decrease recently. The latest candle on the chart is bearish, indicating significant selling pressure that pushed prices toward $0.3200

Martinez pointed out, "The TD Sequential presents a buy signal on the Dogecoin daily chart, anticipating a price rebound!" This sentiment is based on the TD Sequential, a widely respected technical strategy developed by Tom DeMark, which aims to identify potential trend reversals by analyzing consecutive candles.

Typically, the indicator monitors up to nine consecutive directional candles. In a continued downtrend, reaching a nine-count often suggests a potential bullish turning point, known as a "TD9 Buy Signal." Conversely, nine consecutive upward moves during an uptrend could indicate a bearish shift. In extended patterns, the indicator can count up to 13, but the "9" signal usually garners immediate trader attention.

The recent appearance of a TD9 on the Dogecoin chart suggests a possible easing of the downtrend. Following this, the sequence resets, which may signal a new bullish pattern if subsequent candles confirm the trend reversal.

The critical support level is at $0.313, reflecting the 0.382 Fibonacci retracement on the daily chart. Closing above this level might bolster bullish activity in response to the TD9 signal. Any upward movement would likely encounter initial resistance around $0.3400, coinciding with the downtrend line. Successfully surpassing this line could validate the anticipated trend change.

For a robust recovery, regaining the $0.4000 region, aligned with the 0.5 Fibonacci level at $0.395, would indicate Dogecoin's rebound from its descent. The current situation is pivotal for Dogecoin. The TD Sequential's "buy" signal, while not a guarantee of immediate price increase, is often a reliable early indicator of trend reversal. If bullish investors act on this signal, Dogecoin could advance toward mid-range resistances. However, failing to maintain the $0.3100 level might extend the current downtrend.