SUNDOG (SUNDOG) Breaks Falling Wedge, But BeInCrypto Analysis Indicates a Bull Trap May Be Brewing

Tron-based meme coin Sundog (SUNDOG) has surged by 8% in the past 24 hours, breaking above a falling wedge pattern it had traded within since September.

Tron-based meme coin Sundog (SUNDOG) has seen an 8% surge in the past 24 hours, breaking above a falling wedge pattern that it had traded within since September.

However, an analysis of SUNDOG’s technical setup by BeInCrypto suggests that the recent rally may be a false breakout.

This analysis dives into the reasons behind this assessment and outlines key signals for SUNDOG holders to keep an eye on.

SUNDOG’s Surge May Cause a Bull Trap

An examination of the SUNDOG/USD one-day chart reveals that the meme coin broke above the upper line of its falling wedge during Thursday’s intraday trading session. This pattern is formed when an asset’s price moves between two descending trend lines, with the upper line acting as resistance and the lower line as support.

A breakout above the wedge’s upper trendline is a bullish move. It suggests buyers are gaining strength over sellers and hints at a sustained price increase.

However, a closer inspection of some of SUNDOG’s momentum indicators suggests that this rally may be a false breakout, potentially setting up a bull trap.

A bull trap occurs when an asset’s price briefly breaks above a key resistance level which would usually signify a positive shift in trend. However, instead of continuing the uptrend, the price falls again, ‘trapping’ those who bought in on the bullish signal.

The setup of SUNDOG’s Super Trend Line is a notable indicator of this potential bull trap. At press time, the red line of the indicator rests above SUNDOG’s price.

The Super Trend indicator tracks the overall direction and strength of an asset’s price trend. It appears as a line on the price chart that changes color according to the trend’s direction: green for an uptrend and red for a downtrend.

When the Super Trend line appears below an asset’s price, it indicates an uptrend, suggesting bullish momentum may persist. On the other hand, when the Super Trend line turns red and appears above an asset’s price, bearish pressure is strong.

Moreover, the negative readings of SUNDOG’s Balance of Power (BoP) also support the possibility of a price reversal in the near term. As of this writing, the meme coin’s BoP stands at -0.82 despite its price uptick.

This indicator measures the strength of buyers versus sellers in the market. A negative BoP suggests sellers are in control and attempting to push the asset’s price downward.

SUNDOG Price Prediction: If Retest Fails…

A combined reading of SUNDOG’s Super Trend and BoP indicators suggests that its breakout above the upper line of the falling wedge may occasion a bull trap when the retest attempt of the resistance line fails due to strong bearish sentiments in the market.

At press time, SUNDOG trades at $0.13. A reversal of its uptrend due to strengthening bearish pressure may see its price drop to $0.09, where support lies. However, if the uptrend persists, SUNDOG’s price may rally toward $0.20.