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With a stand-off at $0.33, technical indicators suggest that Dogecoin may be poised for a reversal. Is a price recovery possible for DOGE amidst a declining crypto market?
As Bitcoin drops to $92K, the meme coin segment has fallen below a $100 billion market cap. Dogecoin, down by 3.33% in the past 24 hours, has experienced a 4.08% drop overall.
With a market cap of $50 billion, Dogecoin continues to dominate more than 50% of its segment. However, the recent surge in supply has raised concerns among its holders.
Dogecoin Price Analysis
On the 4-hour chart, Dogecoin’s price action shows a failed attempt to maintain above the 61.80% Fibonacci level at $0.37772, followed by a minor consolidation phase that lasted for a few days.
However, with the broader market correction, Dogecoin fell after failing to break through the psychological resistance at $0.40. This correction led to a 24-hour low at $0.32417.
Despite this, the underlying support from the 38.20% Fibonacci level at $0.33030 prevented a strong bearish close, leading to a brief consolidation. As of now, Dogecoin is priced at $0.33957.
The sudden surge in supply caused a bearish crossover between the 20- and 50-period EMA lines. However, the 4-hour RSI is moving sideways above the oversold boundary, signaling a bullish divergence. This suggests that a potential rebound for Dogecoin is still possible.
With Blood in the Streets, Is It Time to Buy?
According to a recent tweet by Santiment, the average trading returns for Dogecoin are currently negative. This indicates that wallets active over the past 30 days are showing losses, and the MVRV (Market Value to Realized Value) ratio has turned negative.
This could present a potential buying opportunity, with “blood on the streets.” Dogecoin’s MVRV ratio is at -8.892%, significantly higher than Bitcoin’s at -3.73% and Cardano’s at -6.693%.
DOGE Price Target
With the bullish divergence in the RSI and the likelihood of professional traders entering the market to capitalize on discounted prices, Dogecoin could experience a minor rebound. The immediate resistance is near the 50% Fibonacci level and the 200 EMA at $0.35.
Beyond that, the bullish trend could face significant resistance around the psychological $0.40 mark. On the other hand, a bearish trend could revisit the crucial support zone around $0.30.