- Dogecoin bulls are tasked with defending $0.03 support to avert a potentially massive breakdown.
- DOGE is dealing with massive seller congestion zones ahead that could delay recovery.
- The downtrend could be sabotaged if Dogecoin sustains an hourly candlestick above the 100 SMA.
Dogecoin recovery has become an uphill task after plunging from $0.088. The bearish outlook has also remained unchallenged over the last couple of days, as reported. Meanwhile, the 'Meme Coin' is exchanging hands at $0.032 amid the bulls' intensive fight to hold above $0.030.
Dogecoin critical support in jeopardy as technicals flip bearish
Slightly above the prevailing market value, Dogecoin is facing acute resistance under the 100 Simple Moving Average. It is essential to note that the token is also trading below the 50 SMA on the 1-hour chart, significantly increasing overhead pressure.
The most significant technical development is the formation of a symmetrical triangle pattern. This type of triangle can be described as a volatility-contraction pattern. In other words, it marks a decrease in an asset's volatility. The triangle also signifies a potential breakout or breakdown.
A breakout occurs after the price hits levels above the upper trendline. Similarly, a breakdown takes place when the price crosses below the lower trendline. Note that the triangle has an exact target that can be used as a stop loss, measured from the highest to the lowest point of the pattern.
If DOGE loses the support at $0.030, a 60% breakdown could come into play, forcing Dogecoin to explore lower price levels toward $0.0138. Investors still holding Dogecoin are probably worried that the bottom yet to be found. Therefore, declines under $0.030 could trigger panic-selling.
DOGE/USD 1-hour chart
The IOMAP model by IntoTheBlock confirms that recovery will not come easy based on the robust seller congestion zones ahead. The largest hurdle runs from $0.036 to $0.037. Here, nearly 29,000 addresses had previously bought about 2.8 billion DOGE.
Dogecoin IOMAP model
The same IOMAP model highlights the key support, $0.0315 to $0.0324. Roughly 23,000 addresses are currently profiting from the approximately 7.6 billion DOGE formerly purchased in the range. Buyers must hold above this critical zone; otherwise, Dogecoin could dive downstream.
Looking at the other side of the picture
As mentioned above, the symmetrical triangle can result in an upswing if Dogecoin breaks above the upper trendline. However, DOGE must jump above the 100 SMA to sustain an uptrend. Besides, crossing beyond the 50 SMA would call out to buyers to join the market, in turn, pushing Dogecoin toward $0.055.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended Content
Editors’ Picks
Is Altcoin Season here as Bitcoin reaches a new all-time high?
Bitcoin reaches a new all-time high of $98,384 on Thursday, with altcoins following the suit. Reports highlight that the recent surge in altcoins was fueled by the victory of crypto-friendly candidate Donal Trump in the US presidential election.
Shanghai court confirms legal recognition of crypto ownership
A Shanghai court has confirmed that owning digital assets, including Bitcoin, is legal under Chinese law. Judge Sun Jie of the Shanghai Songjiang People’s Court shared this opinion through the WeChat account of the Shanghai High People’s Court.
BTC hits an all-time high above $97,850, inches away from the $100K mark
Bitcoin hit a new all-time high of $97,852 on Thursday, and the technical outlook suggests a possible continuation of the rally to $100,000. BTC futures have surged past the $100,000 price mark on Deribit, and Lookonchain data shows whales are accumulating.
Shiba Inu holders withdraw 1.67 trillion SHIB tokens from exchange
Shiba Inu trades slightly higher, around $0.000024, on Thursday after declining more than 5% the previous week. SHIB’s on-chain metrics project a bullish outlook as holders accumulate recent dips, and dormant wallets are on the move, all pointing to a recovery in the cards.
Bitcoin: New high of $100K or correction to $78K?
Bitcoin surged to a new all-time high of $93,265 in the first half of the week, followed by a slight decline in the latter half. Reports highlight that Bitcoin’s current level is still not overvalued and could target levels above $100,000 in the coming weeks.
Best Forex Brokers with Low Spreads
VERIFIED Low spreads are crucial for reducing trading costs. Explore top Forex brokers offering competitive spreads and high leverage. Compare options for EUR/USD, GBP/USD, USD/JPY, and Gold.