Analyst Warns of Dogecoin Correction After Sell Signal Flashes on Multiple Timeframes

Market analyst Ali Martinez has warned of an imminent Dogecoin correction as the indicator flashes a sell signal on multiple timeframes.

Dogecoin’s face-melting uptrend may be discontinued in the short term after a remarkable, bullish explosion by the largest meme coin by market cap. For context, Dogecoin has surged an impressive 123% in the past seven days, leading to a broader market uptrend.

Dogecoin’s impressive performance becomes more evident in the 30-day timeframe, as it has grown a remarkable 224%, reaching price levels last seen in over three years. Notably, this price appreciation is influenced by multiple factors, including favorable macroeconomics and its ties with Elon Musk, who was pivotal in Donald Trump’s election conquest.

Meanwhile, analyst Ali Martinez has warned that this uptrend may be shortlived, at least for now, following multiple timeframe indications. The analyst noted that Dogecoin could retrace from current price levels before its next leg up.

TD Sequential Indicator Shows Possible Retracement

In a Tuesday tweet, Martinez shared that the TD Sequential indicator has flashed a sell signal on multiple Dogecoin chart timeframes, pointing to a possible retracement. Notably, the indicator shows this sell signal on Dogecoin’s 4-hour and 12-hour timeframes while also forming on the daily chart.

With the signal, Martinez warned that Dogecoin may be choppy in the near term, relinquishing some of its gains before the next bullish phase. However, the seasoned analyst maintained a bullish future outlook for the meme coin, noting the impending correction was only temporary.

Dogecoin Technical Analysis

Notably, technical analysis backs Martinez’s assertions of a short-term price correction. In the 4-hour timeframe, Dogecoin’s relative strength indicator (RSI) stands at 67.24, showing that the leading meme coin is drawing closer to being overbought.

Furthermore, the MACD indicator shows Dogecoin could take a bearish turn, with the MACD line at 0.004583 and the signal line at 0.03645. The MACD line is headed downward, signaling a crossover may be imminent.

Broader Market Recovery?

Meanwhile, Dogecoin is not the only asset seemingly correcting. The broader market has retraced from its daily highs in the past hours, signaling that the crypto market may be heading for consolidation.

Bitcoin, for instance, has retraced 3.8% from its $89,956 high today. Ethereum and Solana have also corrected 5.3% and 6.67% from their daily highs, respectively.

Martinez also warned of the retracement, citing a spike in Bitcoin’s Google search. In the analysis, he encouraged caution, noting that retail interest in the crypto firstborn always spearheads a price drop.

In the meantime, Bitcoin trades at $86,320, while Dogecoin exchange hands at $0.358.