Dogecoin Faces 16% Price Drop as Analysts Warn of Further Slump
Dogecoin (DOGE) has declined approximately 16% from its November 23 local high of $0.4795. Analysts suggest that DOGE's recovery largely depends on Bitcoin's performance.
Dogecoin Price At Risk Of Another Slump
Technical analysis indicates that a previously established uptrend line from mid-November has become a significant barrier. After breaking this support line, attempts to push the price back above it have failed.
Crypto analyst Kevin (@Kev_Capital_TA) notes that DOGE is facing rejection at this trend line and is positioned at the macro .786 Fibonacci level, which often marks crucial turning points.
Internal momentum indicators also show challenges. The daily MACD for DOGE indicates strong downward momentum, suggesting a bearish short- to mid-term outlook unless the broader crypto market changes.
Kevin states that without a rise in Bitcoin, DOGE’s likely movement is downward, targeting $0.32 as a key downside level. If it fails to hold above this, traders may look towards the $0.29 to $0.26 range.
He highlights that DOGE is currently trading between two important long-term Fibonacci levels: the macro golden pocket around $0.47 and the macro 0.5 Fib level near $0.39. A decisive break above or below these levels could lead to significant price movements.
Kevin asserts that DOGE's future is heavily influenced by Bitcoin, making detailed analysis of DOGE less relevant at this moment. He sees potential for upward movement but emphasizes waiting if holding long-term positions.
A potential hidden bullish divergence on the DOGE daily chart may indicate underlying strength despite current price trends. This occurs when price rises over a longer timeframe while momentum indicators decline.
What About Bitcoin?
Kevin describes Bitcoin as currently being “squeezed” between an upward support trend line and a macro golden pocket, indicating an imminent breakout in either direction. This tightening suggests that BTC will not remain compressed much longer.
On the liquidity front, Kevin identifies significant upside liquidity blocks for BTC, with recent liquidity aligning with the macro 1.703 Fibonacci level. Additionally, large options calls for MicroStrategy stock by whales may indicate anticipation of a BTC increase. If these factors align, a BTC rise could provide DOGE the opportunity it needs to stabilize and reverse its downtrend.
At press time, DOGE traded at $0.405.
