Dogecoin (DOGE) Price Correction Continues, Ascending Triangle Pattern Poses Both Opportunity and Risk

Dogecoin's (DOGE) price action is on a correction path in the weekly timeframe, with the cryptocurrency currently down by about 13% in the past seven days.

Dogecoin (CRYPTO: DOGE) price action is on a correction path in the weekly timeframe, with the cryptocurrency currently down by about 13% in the past seven days.

Although the broader crypto market sentiment appears positive, the king of meme coins is yet to take advantage of this and push above the $0.4 mark. Technical analysis of the DOGE price chart shows that the cryptocurrency is fluctuating in an ascending triangle, which could be dangerous for the price trajectory moving forward.

Dogecoin’s Ascending Triangle Pattern: Opportunity Or Risk?

Cryptocurrency price analysis shows that the ascending triangle currently shaping DOGE’s price movement holds both promise and danger.

Historically, this pattern is mostly known to eventually lead to a breakout to higher levels, but it also has the likelihood of sharp declines if the price breaches key support zones within the pattern.

In this case, the bullish trajectory should be the case, but Dogecoin’s lingering flunctuation within the pattern suggests that the meme coin might initially trend downwards, even if it were to eventually go on another rally.

Optimism following Donald Trump’s election has created a positive broader market sentiment, which could support Dogecoin’s upward momentum.

However, this optimism might not shield the meme coin from the potential volatility tied to its lingering price action within this setup.

Can Dogecoin Rebound Upwards From Here?

At the time of writing, DOGE is trading at $0.36, reflecting a 2.6% gain in the past 24 hours after rebounding from $0.34.

However, this daily recovery has done little to offset its broader performance, as Dogecoin still remains down 13.2% over the past seven days.

An analysis of recent price movements shows that the meme coin has faced repeated rejections at a downward-sloping trendline in the past seven days.

As it stands, DOGE is now looking to break above this downward sloping trendline again.

Another rejection here will prolong the downward price movement.

The opinion in this case is that Dogecoin may have already topped this cycle, which would lead to another prolonged correction towards the $0.22 mark.

The other outcome is that Dogecoin breaks out of the trend line and go on an upward move from here.

This is the more bullish option.

According to technical analysis by crypto analyst Kevin (@Kev_Capital_TA), this is the more likely scenario for Dogecoin.

He noted that despite the downtrend, DOGE is still trading above the macro golden pocket.

However, he did note that this scenario would depend mostly on Bitcoin (CRYPTO: BTC) making the bullish move first.