Why shorting Dogecoin price could be the way to go

Dogecoin price action prints red numbers, halting the altcoin in its tracks.
DOGE price sees the monthly S2 support level holding at $0.0869.
Expect a dip back to $0.0700 if price action breaks to the downside.

Dogecoin (DOGE) price hit a curb as the ASIA PAC session triggered some bearish moves in price action. DOGE price now sees dark clouds forming after Tuesday’s clear skies after the FED alluded to a more hawkish rate path to control inflation. This gave a cramp to the markets and saw all asset classes pulling back from their moves on Tuesday, triggering red numbers in cryptocurrencies across the board, with DOGE price at risk of dropping 22%.

DOGE price at risk of dropping by looming headline risk

Dogecoin price sees investors cashing in on the small gains they booked after the move higher on Tuesday, as Shanghai reported reopening and easing lockdowns, deflating several tail risks in the process. It seems nothing is what it seems, as those tail risks are now being inflated again and weighing on the price action in all asset classes. Across the board, markets are seeing price action coming back from the highs or lows printed on Tuesday.

DOGE price is no different, with the price nearing the monthly S2 support level at $0.0869. If that level does not hold, expect to see a more considerable drop that might result in a 22% correction towards $0.0700. Another leg lower towards $0.0500 could also be on the cards but would need another catalyst, such as the return of dollar strength, reflected in new lows for EUR/USD.

DOGE/USD daily chart

As long as the S2 support level holds, any short-term sideways price action is acceptable. Once markets start to settle down and a bullish theme presents itself in an environment where things are finally stable, the DOGE price could pop above $0.0944 and hit the magic $1 marker, making 14% gains in the process.

Share: Cryptos feed

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.

Join Telegram