- Dogecoin bulls saw their profits halted at $0.29.
- The DOGE price rejection on the red descending trend line keeps Dogecoin price action stuck in a pennant.
- With profit-taking happening across the board in several cryptocurrencies, any further upside in Dogecoin price action looks muted.
Dogecoin (DOGE) continued its positive trend this week, following the bounce off the green ascending trend line supporting the uptrend since February of this year. On the upside, DOGE price action was somewhat capped by the red descending trend line and the monthly R1 resistance level. Expect prices to get squeezed in towards each other in the next coming weeks for Dogecoin.
Dogecoin price action will consolidate in the coming weeks, followed by a bullish outbreak
Dogecoin price action is still in an uptrend since February 2021, marked by the green ascending trend line. That same green trend line got tested twice past two weeks and still shows resilience against any bears. Dogecoin bulls use each test on the trend line to rejoin or add positions in the DOGE price action.
The bounce off that green ascending trend line at $0.19 acted as a launching point for a bullish candle that got topped at $0.29. Around that level, the monthly R1 resistance level comes in, and the red descending trend line from mid-August forms the topside of a pennant. This way, bulls in DOGE saw their profits limited to only 50%.
DOGE/USD weekly chart
Dogecoin price will see bulls trying to form a third green candle above $0.26. If bulls succeed in that attempt, expect a preemptive breakout from the pennant and the red descending trend towards $0.35. If the consolidation continues and prices are getting further squeezed towards each other with lower highs and higher lows, expect bulls to take the upper hand in Dogecoin price action and face much fewer bears because they would be washed out during the consolidation phase. Bulls then would face less resistance towards $0.35 and might even see $0.50 as price target in DOGE.
For the worse, a shift in market sentiment could spell an attack on the green ascending trend line from DOGE bears. If bulls forfeit on the ascending trend line, expect $0.19 and $0.16 to provide some good support. At $0.14, bulls will be stopping DOGE bears in their tracks as Dogecoin price action at that level is trading at a very attractive discount.