Dogecoin has recently been trading in a tight range below a key resistance zone, currently indicated between $0.21 and $026.

Over the past week, the meme coin has been encountering resistance at the $0.25 mark, threatening to send it crashing downwards. However, according to one analyst, who shared a breakdown of Dogecoin’s daily chart on X, the meme coin could experience a further shakeout before eventually making a move upwards.

Analyst Forecasts Shakeout To $0.21 Before Breakout To $0.4

According to technical analyst Trader Tardigrade, Dogecoin seems to be forming the second leg of a two-part consolidation structure.

This structure, which includes a brief retest of support around $0.21 following an earlier rally in May, is consistent with shakeout patterns designed to remove weak hands before the next bullish impulse.

The analyst expects this leg to deepen slightly towards $0.21 again before Dogecoin gains strength to attempt a breakout through the overhead resistance marked just above $0.25. If that move succeeds, the next logical price target sits around $0.4, a level not seen since January 2024.

Examining The Resistance Zone Between $0.24 To $0.25

The resistance zone around $0.25, highlighted in the chart above with a thick horizontal red bar, represents a reactive area of support turned resistance. Notably, this level acted as much of a support level during Dogecoin’s initial decline in February, before eventually caving in due to the intense selling pressure at the time. That breakdown shifted the market structure, turning what was a safety net into resistance.

Now, as Dogecoin attempts to recover from its April low of $0.13, this $0.25 region has emerged as the primary barrier obstructing the continuation of its rally, with multiple intraday rejections near this level in recent weeks. Breaking through this resistance zone also depends largely on the wider crypto market and inflows into the industry. However, until there’s such confirmation, the technical analysis by Trader Tardigrade suggests a cautious outlook for day traders, especially given the possibility of a flush down to $0.21.

At the time of writing, Dogecoin is trading at $0.2279, up by 2% in the past 24 hours, having recently reached an intraday low of $0.2174. Should the bullish scenario play out from this level, a move toward $0.40 would mark an impressive 85% gain from the current price of Dogecoin.