Can Dogecoin Hold Support at $0.15 Amid Market Correction?
Dogecoin (DOGE), the largest memecoin by market cap, experienced a significant correction over the weekend as the overall crypto market saw a sell-off. The price of DOGE dropped by 21%, falling from $0.192 to $0.15. However, this correction falls within the safety net of the Fibonacci retracement tool and indicates a bullish continuation pattern, suggesting that DOGE may be poised for further growth.
Formation of a Bullish Continuation Pattern
The recent volatility in DOGE is evident from the long-wick rejection candle in the daily chart. Despite this, there is consolidation happening within two converging trend lines, which indicates the formation of a bullish continuation pattern known as a Pennant.
This pattern suggests that the DOGE price has exhausted itself after the recent rally that pushed its price from $0.084 to $0.206, and it needed a minor pullback to regain strength.
Currently, there is a 6.9% intraday loss in the Dogecoin price, and it is testing the lower trendline of the Pennant pattern. If the ongoing market correction strengthens sellers enough to break this support level, it will increase supply pressure and invalidate the bullish thesis.
In such a scenario, the price of DOGE may drop further to find support at $0.124.
Potential Breakout Strategy for Dogecoin Price
Assuming the patterns hold true, there is a possibility that the price of DOGE will rebound from the lower trendline and continue the current consolidation phase. To resume the recovery trend, buyers need to break the upper trendline of the Pennant pattern. This pattern, observed on a 4-hour chart, suggests that there may be another 1-2 weeks of consolidation before a decisive breakout.
If a breakout occurs, the price of DOGE could surpass $0.2 and potentially reach a target of $0.26.
Technical Indicators
- Exponential Moving Average (EMA): The 20-day EMA acts as immediate support for buyers, preventing further correction.
- Relative Strength Index (RSI): The daily RSI shows a downtick at 54%, indicating a decrease in bullish momentum in the market.
Will DOGE Hold Support Amid Market Correction?
Dogecoin (DOGE), the largest memecoin by market cap, recently experienced a significant correction as the overall crypto market saw a sell-off. The price of DOGE dropped by 21%, falling from $0.192 to $0.15. However, this correction falls within the safety net of the Fibonacci retracement tool and indicates a bullish continuation pattern, suggesting that DOGE may be poised for further growth.
Formation of a Bullish Continuation Pattern
Despite the recent volatility in DOGE, there is consolidation happening within two converging trend lines, indicating the formation of a bullish continuation pattern known as a Pennant. This pattern suggests that the DOGE price has exhausted itself after a significant rally and needed a minor pullback to regain strength.
Currently, the price of DOGE is testing the lower trendline of the Pennant pattern. If the ongoing market correction strengthens sellers enough to break this support level, it will invalidate the bullish thesis and potentially lead to further downside.
However, if the support at $0.15 holds, it indicates that buyers are stepping in to prevent further downside and could lead to a continuation of the bullish trend.
Potential Breakout Strategy for DOGE
Assuming the patterns hold true, there is a possibility that the price of DOGE will rebound from the lower trendline and continue its consolidation phase. To resume the recovery trend, buyers need to break above the upper trendline of the Pennant pattern.
A breakout above the upper trendline could potentially lead to a retest of previous resistance levels and further upside for DOGE.
Technical Indicators
- Exponential Moving Average (EMA): The 20-day EMA acts as immediate support for buyers, preventing further correction.
- Relative Strength Index (RSI): The daily RSI shows a downtick, indicating a decrease in bullish momentum in the market. However, it is still above the 50 level, suggesting that there is still some buying pressure present.
Hot Take: Dogecoin Price Continues to Show Resilience Amid Market Correction
Despite the recent correction in the crypto market, Dogecoin (DOGE) has shown resilience and managed to hold its support at $0.15. This is an encouraging sign for DOGE bulls, as it indicates that there is buying pressure at this level and potential for further upside.
The formation of a bullish continuation pattern, along with the support from the Fibonacci retracement tool, suggests that DOGE may be poised for further growth in the coming days. However, it is important to monitor the overall market conditions and any potential shifts in sentiment that could impact DOGEโs price.
As always, it is advisable to do your own research and consider your risk tolerance before making any investment decisions in the crypto market.
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