Dogecoin has been navigating a descending channel on its short-term chart, but recent price action suggests a potential trend shift as the cryptocurrency attempts to break above key resistance levels.
After finding support near the 0.16661 level (0.0% Fibonacci), DOGE has staged a notable recovery and is currently trading at 0.17447.
The price action indicates that DOGE/USD has recently found strong buying interest at the lower boundary of the descending channel, triggering a bounce that has pushed the price through the 38.2% Fibonacci retracement level at 0.17225.
The cryptocurrency is now testing the 50% Fibonacci level around 0.17397, which coincides with a horizontal resistance zone that previously acted as support.
Dogecoin Technical Indicators
The 100 SMA (blue line) is positioned above the 200 SMA (red line), suggesting that the path of least resistance is to the upside despite the recent downtrend within the channel. However, the gap between these moving averages has been narrowing, which could signal weakening bullish momentum if a bearish crossover materializes in the coming sessions.
The stochastic oscillator has been rising from oversold conditions and is now approaching overbought territory, indicating strong buying pressure in the short term.
This upward momentum could help propel Dogecoin toward the 61.8% Fibonacci retracement level at 0.17570, which represents the next significant resistance. A break above this level could open the path toward the upper boundary of the descending channel and potentially the 100% Fibonacci level at 0.18132.
Meanwhile, the MACD indicator (shown at the bottom of the chart) appears to be forming a bullish crossover as the blue line crosses above the orange signal line, further supporting the case for continued upside momentum in the near term.
Potential Dogecoin Targets
If Dogecoin successfully breaks and closes above the 50% Fibonacci level at 0.17397, we could see accelerated bullish momentum targeting the 61.8% level at 0.17570. Further buying pressure could drive the price toward the upper channel boundary and possibly initiate a larger reversal of the downtrend that has been in place since late April.
However, if sellers return at current levels, Dogecoin could face a rejection at the 50% Fibonacci level, potentially sending the price back toward the 38.2% retracement at 0.17225. A failure to hold this support could trigger another decline toward the recent lows near the 0.0% Fibonacci level at 0.16661.
Traders should watch for reversal candlestick patterns at key Fibonacci levels, as these could provide early signals for potential trend changes. Additionally, a break above the descending channel’s upper boundary would be a significant bullish signal, potentially setting the stage for a test of the 0.18000 psychological level and beyond.
From a fundamental perspective, Dogecoin could take cues from crypto-specific developments, as well as bitcoin price trends after the latest risk rallies. Note that sentiment could also shift depending on geopolitical tensions and tariffs headlines, as worsening conflict and global uncertainty could impact risk flows.
