Dogecoin Price Faces Potential Sell Signal Amid Consolidation Phase
After a significant rally, Dogecoin is currently consolidating, as indicated by technical analysis. Analyst Kevin (@Kev_Capital_TA) warns of a potential sell signal based on his recent update on X, where he shared a weekly DOGE/USDT chart highlighting critical indicators for traders.
Dogecoin Price Analysis
Kevin notes that Dogecoin is "printing a sell signal on the weekly time frame with the red dot appearing," which requires confirmation in the coming week. He identifies three strong technical indicators: a declining Moving Average Convergence Divergence (MACD), a Stochastic Relative Strength Index (Stoch RSI) that has "topped out waiting for a bear cross," and other bearish signals. Despite these, he observes that "price action still looks bullish and money flow is also bullish," suggesting that current bullish factors may outweigh bearish indicators.
Despite long-term sell signals, Kevin remains open to short-term bullish momentum. He points out that Dogecoin has achieved its highest monthly candle body close ever, marking a significant milestone while acknowledging ongoing downside risks.
Looking ahead, Kevin emphasizes the importance of breaking the $0.60 resistance level, stating, “Until we break $0.60 cents cleanly then there’s nothing to really be excited about,” referencing Fibonacci price levels extending to $1.
Kevin also considers macroeconomic factors that could affect Dogecoin's performance. He suggests that an "altcoin season" might drive DOGE's strength if Bitcoin's dominance falls below 55%. He states, “If BTC Dominance breaks the 55% level cleanly you will get your #ALTSEASON folks.”
Regarding long-term moving averages, Kevin mentions his strategy to sell a large portion of his holdings when two specific long-term moving averages cross, indicating market peaks. He refers to the Pi Cycle Top Indicator, traditionally used for Bitcoin, which relies on crossing two moving averages—the 111-day and the 350-day multiplied by two.
Kevin explains, “One of my secret indicators for Dogecoin that is traditionally only supposed to work for BTC is the Pi Cycle tops indicator. It has accurately called every DOGE cycle top and bottom over each of its cycles." He aims to take significant portions out of the market when the two moving averages cross in conjunction with the Monthly RSI reaching a certain level.
At press time, DOGE traded at $0.41.
