- Dogecoin price printed the largest red day this year on January 24 with a 5% loss.
- DOGE consolidates at the mid $0.08 zone and could be setting up for an additional 10% decline.
- A breach above $0.095 would invalidate the bearish thesis.
Dogecoin price is showing substantial evidence to suggest a market decline is on the way. Investors should be aware DOGE’s downside potential going into the final days of the month.
Dogecoin price facing resistance
Dogecoin price may be showing early evidence of trend failure. On January 24, the notorious meme coin displayed a subtle change in market behavior. The bears established the largest red day in 2023, settling the DOGE auction at a 5% loss from the opening price. The down day simultaneously breached the 8-day exponential moving average (EMA), which compounds the idea that bears are engaged.
Dogecoin price currently auctions at $0.083. The Relative Strength Index (RSI), an indicator used to forecast market reversals by comparing and contrasting previous swing points, may suggest that DOGE’s uptrend has ended. The RSI shows declining swing points on January 14 and January 22, which is antagonist to DOGE’s price action that established new highs on both days. The discrepancy displayed from the indicator is known as a bearish divergence, a common signal used for bears to enter the market.
The consolidation in the market is setting up a downswing to challenge buyers in the previous support zones. Key levels will be the $0.077 swing low established on January 18 and the $0.075 pivot point if the bulls don’t provide support. The bearish scenario sets up a potential 10% decline from DOGE’s current market value.
DOGE/USDT 1-day chart
For bears looking to join the market, entry at the current time would be justified. Invalidation of the downswing could occur from a breach above the $0.095 liquidity level. A break higher could likely induce more uptrend price action in the coming weeks. The next area of resistance would likely come in near the psychological $0.10 zone. Dogecoin price would increase by 20% if the bullish scenario played out.
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