Dogecoin Faces Potential Breakdown as Analyst Spots Alarming 2022-Style Signal
A prominent pseudonymous analyst, VisionPulsed, warns that Dogecoin could be heading for a significant price collapse, even if Bitcoin experiences a temporary bounce. The analyst highlights a concerning pattern mirroring 2022 market behavior, which appears to be re-emerging across major cryptocurrencies and popular memecoins. Investors are advised to closely monitor key technical indicators for early signs of this impending downturn.
Bitcoin’s Stochastic Reset: A Crucial Watchpoint
VisionPulsed's analysis centers on Bitcoin's daily stochastic Relative Strength Index (RSI), which is transitioning from overbought to oversold territory. Historically, similar resets over the past two months have consistently led to new price lows for Bitcoin. While acknowledging a slight structural difference this time, the analyst stresses that how Bitcoin navigates this phase will dictate Dogecoin's immediate future. A "higher low" print for Bitcoin during this RSI reset could signal a short-to-medium-term relief rally, offering a glimmer of hope. However, a failure to hold current lows could trigger a deeper decline.
Dogecoin's Dangerous Divergence: A 2022 Echo
The true peril, according to VisionPulsed, lies with Dogecoin. Despite Bitcoin's attempt to establish a higher low, Dogecoin has consistently been printing lower lows, creating a bearish divergence reminiscent of early 2022. During that period, Doge saw a prolonged bleed while Bitcoin quietly found its footing and formed higher lows. This pattern suggests that while Dogecoin might partake in any Bitcoin-led relief rally, it would do so from a significantly weaker position, with a "peanut zone" rally around $0.20 in January potentially being the "last chance" before a predicted capitulation. The analyst's base case for Dogecoin is a substantial retracement, projecting a fall to the $0.05 to $0.06 range. This bearish outlook will persist unless Dogecoin manages to break its current downtrend. The timing of this potential capitulation is tied to Bitcoin's movement within a 7-8 day Gaussian channel and the convergence of specific moving averages. Should Bitcoin hover near the upper range of its current structure by late January, it would effectively be replicating the 2022 scenario, signaling an imminent capitulation. The convergence of a white and green moving average, anticipated for late January or early February, is flagged as the "point of no return" that preceded Bitcoin's previous collapse, potentially leading Bitcoin to test the $50,000-$60,000 range and, consequently, sending Dogecoin to its projected $0.05 target. Dogecoin currently trades at $0.12974.
