The highest price is Dogecoin currently fighting to break above the $0.4 price level again, but technical analysis suggests that may not be the only thing the meme-inspired cryptocurrency is fighting. According to technical analysis by crypto analyst Kevin (@Kev_Capital_TA), Dogecoin is currently stuck in a fight with a main level of resistance defined by the 0.5 Fibonacci macro extension, which may determine whether the price can break through to higher levels above $0.4 or renewed selling pressure.
Moment of truth at Macro 0.5 Fibonacci Extension Resistance
The Fibonacci extension indicator is a popular tool among technical analysts to identify price targets and resistance levels. In the case of Dogecoin, crypto analyst Kevin he made use of this Fibonacci extension projected from the cryptocurrency's low of around $0.15 in mid-October. For Dogecoin, the 0.5 Fib macro extension represents a major barrier that has moved back up.
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This 0.5 Fib extension is also special, as it is located around an order block during Dogecoin's latest correction. Crypto analyst Kevin identified this resistance level as a “moment of truth,” stressing that a successful breach of this level is critical for DOGE to target the golden macro pocket.
Considering recent market dynamics, Dogecoin's ability to overcome this headwind will likely depend on broader market trends, especially on the performance of Bitcoin.
#Dogecoin in the wild with the macro extension 0.5 Fib. This is a great struggle and the key to making it back to the gold macro pocket. #DOGE success here depends entirely #BTC ability to break out of his gold macro pocket. The moment of truth people. pic.twitter.com/vWtfpVahv1
— Kevin (@Kev_Capital_TA) January 6, 2025
Bitcoin's Role in Dogecoin Price Momentum
Bitcoinas the leading cryptocurrency, it usually always sets the tone for the wider market, including other large market cap altcoins such as Dogecoin. Interestingly, Bitcoin inflows and its latest rate break above the The price level of $ 100,000 again in the last 24 hours has flowed into other cryptocurrencies.
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Kevin noted this correlation between Dogecoin and Bitcoin, indicating that Dogecoin's move into its gold macro pocket will depend on Bitcoin's ability to break out of its gold macro pocket himself. If Bitcoin manages to break out of its gold pocket, it could give Dogecoin the momentum it needs to overcome its 0.5 Fibonacci resistance. However, a failure with Bitcoin could leave Dogecoin vulnerable to further consolidation or even another move down.
The gold pocket refers to a specific area within the Fibonacci expansion levels, usually the area between the 0.618 and 0.65 Fib expansion levels. When it is called a gold macro pocket, it indicates that the Fibonacci indicator is being applied to a larger time frame, such as weekly or monthly charts, and that it is on long-term price movements. In an earlier analysisKevin identified $0.49 as the “pocket of macro gold.” In addition, he noted that this level is the first major zone against Dogecoin bulls must push up for a bullish breakout.
At the time of writing, Dogecoin is trading at $0.39, up by 25.5% in the past seven days.
Featured image created by Dall.E, chart from Tradingview.com
