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Dogecoin has flipped into negative price territory in a seven-day timeframe, with the meme coin currently down by 6.11% in the past seven days. However, this price action has led to the emergence of a bullish pattern on the 1-hour candlestick timeframe chart.
The constructive formation follows a corrective drop that briefly pushed Dogecoin to $0.215, but recent trading sessions have seen higher lows and firmer support levels. This, in turn, has led to the formation of an inverse head and shoulders pattern that points to quick bullish targets for the Dogecoin price.
Analyst Identifies Inverse Head And Shoulders Pattern
Crypto analyst Klejdi Cuni posted a technical outlook on social media platform X, highlighting an inverse head and shoulders pattern on the DOGE/USDT chart on the 1-hour candlestick timeframe. The setup consists of three distinct troughs, with the central one being the deepest and forming on May 25th. The right shoulder, on the other hand, formed between May 23 and May 24, bringing rise to what could be interpreted as a short-term bullish reversal.
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According to the analyst, this particular inverse head and shoulders is a smaller-scale formation, making it more relevant for short-term traders looking for quick movements. At the time of writing, Dogecoin is still in the process of completing the left shoulder, as it is now testing the neckline resistance around $0.228. A breakout above this neckline level with enough volume confirmation could trigger a swift move upwards.
Short-Term Upside Targets For Dogecoin
If the bullish inverse head and shoulders setup unfolds as expected, the analyst predicted a Dogecoin price surge first toward the $0.239 zone. This level acted as a support level for many hours on May 22, before eventually breaking down and acting as resistance during a brief upward attempt in the late hours of May 23. As such, this area would be important to note, as a successful breach would then open the door to the next target.
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The next short-term price target if Dogecoin successfully clears $0.239 is at $0.25. Though modest in comparison to some of the more aggressive long and medium-term projections, this level is important for a different reason. A rally to $0.25 would be a full recovery to Dogecoin’s most recent local peak in May. This, in turn, could be the start of a rally continuation to higher price levels toward $0.3 and beyond.
The chart projection above outlines a step-wise movement where the breakout leads to immediate upside action, followed by consolidation before a secondary leg pushes the Dogecoin price to $0.25. However, as with any pattern, confirmation is important. Failure to hold the breakout zone or a breakdown below the right shoulder, which is currently around $0.222, would weaken the bullish outlook and could lead to a retest of $0.21.
At the time of writing, Dogecoin is trading at $0.2245.
Featured image from Getty Images, chart from Tradingview.com
