Crypto analyst Josh Olszewicz is once again warning of an impending Dogecoin price crash. The analysis is powered by the Ichimoku Cloud, a comprehensive indicator that provides information on support/resistance levels, momentum and trend direction. Olszewicz’s analysis highlights two specific technical phenomena on the 1-day (1D) chart of DOGE against the US Dollar (DOGE/USD). Via X, he noticed “1D DOGE: TK bearish crossover + Kumo bearish breakout.
Bearish signals for Dogecoin
The TK bearish crossover refers to the bearish crossover between the Tenkan-Sen (conversion line) and the Kijun-Sen (baseline) within the Ichimoku Cloud system.
The Tenkan-Sen, which is a faster moving line, usually calculated as the midpoint of the high and low over the last nine periods, passing below the Kijun-Sen, a slower line calculated as the point median of highest and lowest. the low of the last 26 periods is considered a bearish signal.
This suggests that short-term prices have fallen below the price base level over the past month, indicating further potential. downward movement.
The Kumo Bearish Breakout: The “Kumo”, which translates to “cloud”, is part of the Ichimoku Cloud indicator and is formed between two other lines: the Senkou Span A and the Senkou Span B. It represents a key zone on the graph. which can serve as support or resistance.
In the context of Olszewicz’s analysis, a “bearish Kumo breakout” implies that the price has broken through the cloud to the downside. This breakout is considered a confirmation of a downtrend. The fact that the price is below Kumo suggests that overall market sentiment for DOGE is negative, with Kumo now likely acting as resistance to any upward price movement.
Olszewicz’s chart shows DOGE trading at $0.15 with the cloud plotted behind the price action, appearing green above and red below the price lines. The cloud that turns green represents a future upside potentialbut price below the cloud and the Tenkan-Sen/Kijun-Sen crossover indicates bearish current circumstances.
An imminent 40% price crash?
This lends weight to Olszewicz’s previous DOGE price analysis. Like NewsBTC reportedThe crypto analyst warned of a potential head and shoulders (H&S) formation on the DOGE/USD 12-hour chart that could be validated soon.
The formation is characterized by two shoulders flanking a distinctive head, with the neckline at around $0.14 being essential. If Dogecoin price were to fall below this critical support, the H&S pattern prophecy would likely manifest, potentially triggering a massive sell-off towards the $0.10 to $0.09 region.
This target zone aligns with the 1.618 and 2.0 Fibonacci extension levels, suggesting a price collapse of around 40% from the neckline. Although this trend is yet to be confirmed, with price still above the crucial $0.14 support level, its presence serves as a warning signal for the market.
The technical confluence of the TK bearish crossover and the Kumo bearish breakout in Olszewicz’s recent analysis only reinforces the possible bearish scenario ahead for Dogecoin. Market participants are recommended to closely monitor the $0.14 level, as a decisive break below could validate the bearish outlook and set the stage for the expected decline.
At press time, DOGE was trading at $0.1413.
Featured image created with DALL·E, chart from TradingView.com
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