U.Today - After a bullish run, momentum has stalled around the $38,000 resistance level, a critical point that has witnessed a confluence of selling pressure. The price action suggests that a short-term retracement may be on the horizon, with a potential fallback to the $35,000 support zone, according to recent analysis.
The daily chart exhibits a consolidation phase, where the price has faced rejection at $38K, leading to subdued volatility and price movements within a range capped by $35,000 and $38,000. This consolidation, along with an extended bearish divergence between the price and the relative strength index (RSI), indicates that bullish momentum might be waning, which could lead to a correction.
A four-hour chart perspective reveals an ascending wedge pattern, which is typically considered a bearish reversal signal. Concurrently, a head and shoulders pattern is forming, nearing the completion of the right shoulder.
This pattern is a crucial indicator of a potential bearish reversal, becoming valid if the price dips below the pattern's neckline, potentially leading to a price drop below the wedge pattern, with key support at the $32,300 level, marked by the 0.5 Fibonacci retracement.
On-chain analysis adds another layer to the narrative. The movement of from miner wallets to exchanges usually implies an increase in market liquidity and selling pressure. However, there has been a decline in such activity to levels not seen since 2017, which may indicate that miners are holding onto their coins, a sign that could be interpreted as bullish sentiment.
Shiba Inu struggling
The chart reveals a symmetrical triangle pattern, characterized by two converging trendlines as the price swings high and low within a tightening range. This pattern often indicates a continuation or a reversal, with the direction of the breakout providing insight into future price trends. As SHIB approaches the apex of the triangle, the possibility of a breakout looms, with traders closely watching which way the price will veer.
Volume profiles during this period paint a cautious picture, with no significant spikes to suggest a firm decision by the market participants. A notable volume increase would be necessary to validate any potential breakout, providing the conviction needed for a sustainable price move.
SHIB's recent pattern also exhibits lower highs and higher lows, a tension that hints at an impending volatility spike. However, without a clear increase in trade volume, it is challenging to predict the direction of the breakout. Should SHIB break above the triangle's upper trendline, it would suggest bullish sentiment, potentially leading to a price surge.
Dogecoin's surprising rally
The chart shows DOGE recently bouncing off these moving averages, suggesting a strong area of support around the $0.078 price point. This level has become a litmus test for the meme coin, as maintaining above it may attract further buying interest. On the flip side, a fall below could trigger a sell-off, testing lower support levels.
Currently, DOGE's resistance seems to be forming near the $0.085 mark, a level that has previously seen a consolidation of sell orders. A breakthrough above this resistance could pave the way for DOGE to target the next psychological level at $0.1, a target that has eluded it in the recent past.
The trading volume has been relatively stable, without any significant spikes, which could suggest a lack of aggressive trading at the moment. However, as the crypto market is known for its volatility, any increase in volume could quickly change the current dynamic.