As Wednesday drew to a close, Dogecoin witnessed a pullback due to growing bearish market sentiment, causing the dog-themed meme coin to enter a consolidation phase. DOGE’s price may be consolidating, but a crypto analyst claims that the development is a promising one that could trigger an upward trend to higher levels.
DOGE Prepares For Possible $0.4 Run
Dogecoin’s renewed upward trend seems to have lost steam as it revisits the $0.22 mark after the market turned slightly bearish. Currently, the meme coin is hovering within a narrow price range as investors and traders anticipate its next major move.
In a recent analysis on the X (formerly Twitter) platform, Trader Tardigrade, a market expert and investor, outlined that DOGE has entered a consolidation phase following its pullback. However, DOGE in a consolidation phase could just be the foundation of an impending strong rally.
Although this period of sideways action can seem inconspicuous, Trader Tardigrade’s analysis flags the phase as a strategic pause prior to a big breakout. Furthermore, it implies that DOGE is gathering strength within the narrow price range even as the market momentum gradually wanes.
Looking at his chart, the meme coin has reached a crucial level and is experiencing some resistance around the key zone. Its recent rejection from the zone led to a brief period of consolidation within the $0.21 and $0.25 price range.
According to the expert, DOGE’s short-term consolidation over a few days is “super healthy for future price movements” as it hovers near critical resistance levels. Nonetheless, Trader Tardigrade expects a breakout in the upcoming days, suggesting that the sideways movement would be short and beneficial. Once the Dogecoin breaks above the current resistance, the analyst is confident it will spur the next major move to the $0.4 mark.
A Significant Rally Ahead For Dogecoin
Key technical signals on the 1-day chart are also pointing to a potential upward trend for Dogecoin. Trader Tardigrade highlighted in another post that DOGE’s “Relative Strength Index (RSI) MA is ready to climb to the top.”
The expert further mentions that this uptrend segment may cause the asset to soar sharply in the short term. His forecast is based on past trends, where the RSI MA turned bullish and sparked a significant rally in November last year.
With growing momentum aligning with an uptick in network activity, DOGE is likely to continue its newfound upsurge. Ali Martinez, an on-chain and technical expert, reported a huge spike in active wallet addresses amid price growth.
Data shows that Dogecoin active wallet addresses have risen to 127,570, indicating heightened adoption and interest in the network. The rise in address activity may be a precursor to a wider recovery as more wallets swing into action, suggesting that the meme coin is preparing for its next significant move.
Featured image from Pixabay, chart from Tradingview.com
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