Dogecoin fans, are you feeling a little nervous recently? This wave of market is really a bit unexpected! Dogecoin (DOGE) fell more than 10% this week, but don’t worry, it started to test a very critical support level on Thursday.
So will Dogecoin continue to fall, or will it rebound from here?
The price of Dogecoin has fallen sharply. Will there be a chance for a reversal?
Let’s talk about Dogecoin’s recent trend: On December 8, DOGE reached its annual high of $0.48. Who would have thought that it would drop by more than 23% right after that? However, this adjustment may not be a completely bad thing.
On Tuesday, DOGE found support around $0.35 and successfully found a bottom. Why is this particularly important? Because $0.35 is exactly the 61.8% Fibonacci retracement level from $0.14 (November 3 low) to $0.48 (December 8 high).
In other words, this is the "golden buying zone" in the eyes of the market.
As of Thursday, the price of Dogecoin has recovered slightly and has stabilized at around $0.36. For those who want to buy the bottom of this downturn, the $0.35 support level may be a good entry point.
Now that the key support level is in place, is there a chance of a rebound?
If Dogecoin successfully holds the support of $0.35 and rebounds, it may lead to a 13.5% increase and challenge the high of $0.41 again. However, don't expect it to happen overnight. The market sentiment is still relatively unstable, so be careful.
We cannot be blindly optimistic because the relative strength index (RSI) of Dogecoin's daily chart has fallen below 50, which means that the selling pressure in the market is relatively heavy.
If Dogecoin is to rebound, the RSI must rise back above 50 to provide some momentum to this rally.
The risk of a downward breakout cannot be ignored
If Dogecoin fails to hold the $0.35 support and falls below $0.34, then be careful, it may continue to fall and even return to the $0.31 support level.
Therefore, if you are planning to enter the market, remember to be extra cautious. The market is highly uncertain and you may step on landmines if you rush into the market.
If you are ready to buy at this position, it is recommended to wait patiently for the support confirmation of $0.35. Remember, the market is changing rapidly, and it is most important to stay calm and operate rationally!
