Dogecoin Technical Setup Signals Potential Major Move

Dogecoin may be approaching a decisive price move, according to a new technical analysis shared by well-known cryptocurrency analyst Trader Tardigrade. The assessment points to a familiar historical pattern on the meme coin’s two-week chart that has previously preceded strong upside rallies.

The analysis focuses on momentum conditions rather than short-term price fluctuations, suggesting that Dogecoin could be entering a critical phase in its broader market cycle.

RSI Pullback Mirrors Pre-Rally Conditions

At the center of the outlook is the Relative Strength Index (RSI), a widely used momentum indicator that measures overbought and oversold conditions. In a January 16 post, Trader Tardigrade noted that Dogecoin’s RSI has retraced to levels that historically signaled the beginning of major upward trends.

According to the analyst, similar RSI pullbacks were observed ahead of Dogecoin’s explosive rallies in 2020 and 2021, when extended periods of cooling momentum gave way to aggressive price expansion.

Two-Week Chart Highlights Compression Phase

The extended two-week timeframe reveals a developing compression phase, a structure that typically forms after prolonged rallies. This phase allows momentum indicators to reset while price action stabilizes, often laying the groundwork for the next major move.

In previous market cycles, Dogecoin spent months consolidating within narrow ranges before transitioning into sharp vertical advances. The current setup shows comparable characteristics, reinforcing the historical parallel highlighted in the analysis.

Accumulation Signals Emerge in Price Structure

Dogecoin’s present range is marked by higher lows and declining volatility, technical features commonly associated with accumulation. These conditions suggest that buyers may be gradually building positions while selling pressure continues to weaken.

As volatility compresses, the likelihood of a strong directional move increases, particularly when combined with supportive momentum signals.

Momentum Indicators Begin to Turn Higher

Additional momentum indicators are starting to curve upward from lower levels, hinting at a potential shift from seller dominance to renewed buyer control. This transition has often acted as an early signal ahead of Dogecoin’s previous breakouts.

When viewed collectively, the RSI retracement, compression structure, and emerging accumulation signals align with conditions that have historically preceded major rallies for the asset.

Market Watches for Confirmation

While no immediate breakout has occurred, analysts note that Dogecoin’s current technical posture closely resembles prior pre-rally phases. Confirmation would likely come in the form of expanding volume and a decisive move out of the current range.

If historical patterns repeat, Dogecoin could be positioning itself for a significant trend shift in the weeks or months ahead.