- Dogecoin risks a 59% drop as it breaks the 2018 trendline and $0.16 support.
- RSI divergence hints at weakening sell pressure amid ongoing correction.
- Whale move of 300M DOGE to Binance sparks bearish market sentiment.
Recent days have seen Dogecoin experience significant price volatility while analysts predict the possibility of a 59% price decline. Technical evaluations indicate that DOGE may soon experience a significant price correction.
Dogecoin Breaks Key Support After Long-Term Trendline Breach
Dogecoin exhibits weakness after breaking through the ascending trendline that provided support since 2018. The technical shift marked by the breach indicates a possible bearish continuation for the memecoin. Dogecoin’s recent downward trend matches a wider deceleration in its price momentum because it broke through the $0.16 resistance level which represents the 0.786 Fibonacci retracement point.
According to Ali Charts, the loss of this key trendline support suggests bearish momentum. The next crucial support level has been identified by analysts at $0.06167 which matches the 0.618 Fibonacci level. Previous trading cycles found this price level functioning as a consolidation zone.
Dogecoin’s price may drop to $0.060 if support levels continue to fail. The on-chain data reveals a sizable transaction where 300 million DOGE valued at $41.7 million has been moved to Binance. The substantial transaction created market uncertainty which supported bearish momentum.
RSI Divergence Suggests Potential Shift in Momentum
Technical indicators illustrate that despite the sharp market correction momentum could be transitioning. Dogecoin has hints of a bullish divergence on the daily chart, as per Crypto trader Trader Tardigrade. This pattern is evident when the price goes lower while the Relative Strength Index (RSI), bounces and posts higher lows. This suggests that the selling momentum may be weakening, potentially indicating a price reversal.
The price of Dogecoin has returned to test the $0.135 mark. The $0.135 price level has served as an important support and resistance point during past market consolidation periods. According to analysts a price stabilization followed by a rebound from this level would signal the start of a recovery. Should this support level break it will lead to the $0.12 and $0.10 levels being activated.
According to an X post by crypto analyst Kev Capital, Market observers acknowledge $0.18 as a crucial resistance level. If the zone is reclaimed successfully then it could signal that a short-term recovery is starting to take place. Further price resistance awaits at the $0.25 and $0.30 marks but traders must wait for more decisive price movements to validate these levels as true reversal points.
Traders Monitor Key Levels
Dogecoin’s market sentiment shows no clear direction because it continues to experience both positive and negative signals. The failure to maintain the ascending channel indicates that bearish sentiment might take control in the short term. RSI divergence together with historically significant support levels indicates potential market recovery with increased buying pressure.
The three-month sentiment indicator reveals equal dominance between bullish and bearish forces. Technical breakdowns together with whale activity have influenced short-term market sentiment to lean towards caution. Financial experts are watching closely to see if Dogecoin remains above its support level or begins its decline to $0.06167.
