Dogecoin is currently struggling to exceed the $0.4 price mark once more. Analysis indicates that the meme-inspired cryptocurrency is not only contending with this challenge but is also facing a significant resistance level identified by the macro 0.5 Fibonacci extension. This critical level could play a crucial role in deciding whether Dogecoin can surge past $0.4 and rise further, or if it will encounter increased selling activity.
Critical point at Fibonacci Extension Resistance level 0.5 at Macro scale.
Technical analysts often rely on the Fibonacci extension indicator to pinpoint potential price movements and areas of resistance. Crypto analyst Kevin applied this tool to Dogecoin, using the cryptocurrency’s mid-October low of approximately $0.15 as a reference point. Notably, the 0.5 macro Fibonacci extension level has proven to be a substantial obstacle for Dogecoin, consistently
The 0.5 Fibonacci extension holds significance as it aligns with a key area of potential resistance in Dogecoin’s recent downtrend. Analyst Kevin pointed out this crucial level, describing it as a decisive moment for DOGE. Breaking through this resistance is seen as essential for Dogecoin to target higher price levels.
The success of Dogecoin in breaking through this resistance level will probably depend on the overall direction of the market, with the performance of Bitcoin playing a significant role in determining its fate.
The Impact of Bitcoin on Dogecoin’s Price Movement
As the leading cryptocurrency, Bitcoin typically dictates the direction of the overall market, influencing the performance of other prominent altcoins, such as Dogecoin. Notably, the recent surge in Bitcoin’s value, which surpassed the $100,000 mark within the last 24 hours, has had a ripple effect, with its increased investment.
Kevin observed a connection between Dogecoin and Bitcoin, pointing out that Dogecoin’s movement to a significant level depends on Bitcoin breaking out of its significant level first. If Bitcoin successfully breaks out, it may give Dogecoin the push it needs to surpass its current resistance level. However, if Bitcoin fails to break out, Dogecoin could be at risk of experiencing more consolidation or a potential downward movement.
The term “golden pocket” denotes a particular zone located between the 0.618 and 0.65 Fibonacci extension levels. When described as a macro golden pocket, it suggests that the Fibonacci tool is being utilized on a broader time scale, like weekly or monthly charts, to assess long-term price trends. Kevin previously pinpointed $0.49 as the significant “macro golden pocket.” He also highlighted this value as the initial key resistance area that Dogecoin bulls need to surpass for a bullish price movement.
