Share:
  • Dogecoin price responds to the oversold market with indecision and uncertainty, not characteristics of a significant low.
  • DOGE fails at the 50-day simple moving average (SMA) with a sizeable reversal but confirms the double bottom.
  • The 200-day SMA is the new line of defense as the digital token moves in an ascending parallel channel.

Dogecoin price rebound remains unvalidated as the cryptocurrency fails to register one close above the midline of an ascending parallel channel since the July 21 breakout. Without greater conviction, DOGE is not positioned for notably higher prices, and maybe the eight-day rebound is just a resting place before the correction resumes.

Dogecoin price behaves like a memecoin, not money

Over the last seven trading days, Dogecoin price has closed with four doji candlesticks, including today’s candlestick. The other three came very close. The lack of price traction embodied by the doji candlesticks is a clear reflection of indecision and uncertainty among the DOGE investor ranks. It may suggest the last eight days are simply a pause in the larger correction beginning in May.   

A second concerning development is the inability of Dogecoin price to manufacture one daily close above the midline of the new ascending parallel channel. Once again, emphasizing the underlying reluctance that is accompanying any intra-day strength for DOGE.

If investors did not target the breakout on July 21 as an entry price, it is challenging now to isolate a timely entry price as the rapidly descending 50-day SMA at $0.238 presses down on price. To adjust for the lack of conviction, DOGE investors should wait for a daily Dogecoin price close above the 50-day SMA before allocating capital.

DOGE/USD daily chart

DOGE/USD daily chart

Interestingly, Dogecoin price is granted three support levels that could contain weakness moving forward, and they closely align. The May 19 low of $0.195 has been instructive for DOGE recently, on the up and downside. A second layer of support is the lower line of the ascending parallel channel at $0.193. The final level is the strategically important 200-day SMA at $0.189 

A failure to hold the 200-day SMA on a daily closing basis introduces the potential to break below the July 20 low of $0.159 and the June 22 low of $0.152 

The presence of numerous doji candlestick patterns on the daily chart is not impressive, but it does not guarantee that the digital asset will flip to the downside. Nevertheless, it confirms a balance between supply and demand that is consistent with indecision and uncertainty.

In general, an uncertain investor base tends to rush for the exits at any sign of trouble. As a result, a Dogecoin price close below the 200-day SMA will invite a new wave of selling pressure, not the kind that is characteristic of real money.

Here, FXStreet's analysts evaluate where DOGE could be heading next as it looks ready to jump.

 

Note: All information on this page is subject to change. The use of this website constitutes acceptance of our user agreement. Please read our privacy policy and legal disclaimer. Opinions expressed at FXstreet.com are those of the individual authors and do not necessarily represent the opinion of FXstreet.com or its management. Risk Disclosure: Trading foreign exchange on margin carries a high level of risk, and may not be suitable for all investors. The high degree of leverage can work against you as well as for you. Before deciding to invest in foreign exchange you should carefully consider your investment objectives, level of experience, and risk appetite. The possibility exists that you could sustain a loss of some or all of your initial investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with foreign exchange trading, and seek advice from an independent financial advisor if you have any doubts.

Join Telegram

Follow us on Telegram

Stay updated of all the news

Join Telegram

Recommended content


Follow us on Telegram

Stay updated of all the news

Join Telegram

Recommended Content

Editors’ Picks

Bitcoin, Ethereum prices struggle after mixed US NFP data

Bitcoin, Ethereum prices struggle after mixed US NFP data

BTC and ETH prices experienced a temporary pullback as crypto market participants reacted to the news of the US NFP data release for May. Similar to the situation in April, the number of Nonfarm Payrolls added far exceeded the market’s expectations.

More Cryptocurrencies News

Solana: A break above $26.30 would spell doom for bears

Solana: A break above $26.30 would spell doom for bears

SOL price has been trading with a bullish bias after an explosive breakout on December 30. However, because of volatility and the gloom in the broader crypto market, SOL has been unable to break above a key hurdle at $26.30, causing the price to trade sideways.

More Solana News

Bitcoin Weekly Forecast: BTC targets $30,000 as short-term bias turns bullish

Bitcoin Weekly Forecast: BTC targets $30,000 as short-term bias turns bullish

Bitcoin (BTC) price shows a clear sign of the bulls’ victory. After failing to trigger a steep correction, bears look now out of context, at least in the short term, allowing buyers to restart a minor uptrend.

More Bitcoin News

China crypto community picks Ethereum, Arbitrum and BNB Chain as top protocols

China crypto community picks Ethereum, Arbitrum and BNB Chain as top protocols

Ethereum, Arbitrum and BNB Chain protocols are top picks for the Chinese crypto community, data from a report shows, a possible bullish catalyst for tokens related to these protocols as Hong Kong opens the door of crypto to retail investors.

More Cryptocurrencies News

Bitcoin: BTC targets $30,000 as short-term bias turns bullish

Bitcoin: BTC targets $30,000 as short-term bias turns bullish

Bitcoin (BTC) price shows a clear sign of the bulls’ victory. After failing to trigger a steep correction, bears look now out of context, at least in the short term, allowing buyers to restart a minor uptrend. 

Read full analysis

BTC

ETH

XRP