Dogecoin price action is currently locked between two critical technical levels, the macro gold pocket and the 0.5 macro Fibonacci retracement level. This observation was emphasized cryptocurrency analyst Kevin (@Kev_Capital_TA) on the X social media platform. Interestingly, according to the analyst, Dogecoin’s immediate fate does not depend on its internal dynamics, but on external factors, primarily Bitcoin’s performance.
Bitcoin’s impact on Dogecoin’s market movement
Since it is the largest cryptocurrency in the world, the overall sentiment towards other cryptocurrencies is always always tied to the sentiment towards Bitcoin. Periods of high inflows into Bitcoin are always accentuated by inflows into other cryptocurrencies and vice versa, with the exception of altcoin seasons.
as biggest meme coinDogecoin is one of the biggest reflections of Bitcoin sentiment. According to IntoTheBlock data, Dogecoin currently has a price correlation with Bitcoin of 0.77 out of a maximum scale of 1. Interestingly, this correlation sometimes even stays in the range of 0.9, especially during increases. In his commentary, cryptocurrency analyst Kevin noted that Dogecoin’s current price trajectory is not self-determined, but rather heavily influenced by Bitcoin’s performance.
In the current situation, the recent market dynamics have seen the price of Dogecoin I’m stuck in between gold pocket macro and 0.5 Fibonacci level macro. In technical analysis, the gold pocket is the area between the 61.8% and 65% retracement levels. These levels, commonly used in technical analysis, serve as support and resistance zones, and crossing them in either direction can lead to a noticeable breakout.
Patience as a strategy
Dogecoin’s price is struggling with a lack of momentum and is struggling to replicate the significant gains seen in October and November. During this period, Dogecoin captured the market’s attention with an impressive upward move of over 400%, largely fueled by enthusiasm before and after the US presidential election.
However, these are bullish sentiments it seems to have weakened leaving the meme coin currently hovering around the $0.4 level. Moreover, Bitcoin’s inability to sustain a significant break above the $100,000 price level has cast a shadow over altcoins such as Dogecoin, whose performance is often tied to Bitcoin’s market performance.
Despite the current price stagnation, cryptocurrency analysts like Kevin remain hopeful about the meme coin. Social media mentions remain bullish and technical analysis suggests Dogecoin price still has plenty of room to run.
“I don’t see anything that tells me the cycle is over; therefore, it should increase soon, regardless of short-term disruptions,” he said commented.
At the time of writing, Dogecoin is trading at $0.404 and has dropped approximately 3.5% in the last 24 hours. On the other hand, Bitcoin is trading at $99,800 and is down 0.8% in 24 hours.
Featured image created with Dall.E, chart from Tradingview.com
