Dogecoin has been moving sideways in recent sessions, holding above an important support area while facing a clearly defined resistance overhead. Technical analysts are increasingly focusing on a classic reversal structure forming on the daily chart—an inverse head-and-shoulders pattern. The setup has been highlighted by market analyst Cantonese Cat.
Consolidation below resistance sharpens the structure
According to the technical breakdown, the left shoulder formed in early December, followed by a deeper “head” into late December. The right shoulder has been developing after prices pulled back from a brief spike in early January. Current price action is drifting back toward the upper boundary of a so-called buy order block located in the middle of the recent range, a zone that has acted as demand over the past several weeks.
Above the market sits a horizontal resistance band that has repeatedly capped upside attempts. A decisive move above this level would be required to confirm the inverse head-and-shoulders pattern and shift the technical bias more clearly in favor of the bulls.
Upside target points toward prior supply
The traditional measured move for this pattern is calculated by taking the distance from the neckline down to the head’s low and projecting it upward from the neckline. For Dogecoin, such a move would place the potential target near a previously identified overhead supply area, where selling pressure could re-emerge.
Bollinger Bands hint at a possible momentum shift
On the two-day chart, Dogecoin is trading above the Bollinger Bands’ basis line. The upper and lower bands currently frame a range that aligns closely with recent lows and the same resistance zone highlighted on the daily chart. Technicians often note that sustained closes above the basis line—and a move into the upper half of the bands—can signal a change in momentum following a prolonged decline.
Notably, the upper Bollinger Band sits close to the same resistance level that must be cleared to validate the inverse head-and-shoulders formation. If Dogecoin holds support within the buy-side block and pushes above this supply zone, the bullish reversal thesis would gain credibility.
What would invalidate the bullish case
Failure to hold the buy order block would significantly weaken the setup. In that scenario, focus would likely shift toward the lower Bollinger Band and the late-December lows, which would become the next key areas to watch for signs of buyer strength—or confirmation that consolidation is giving way to renewed downside.
Dogecoin now sits at a technically sensitive juncture, where several indicators and price levels are converging and could determine the market’s next decisive move.
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