In the past week, Dogecoin (DOGE) has been mired in a bear market, experiencing a substantial price drop of up to 23%, failing to effectively break through the $0.17 mark. This price decline is primarily due to an overall sell-off in the cryptocurrency market, leading to a significant reversal of previously accumulated gains. Currently, DOGE's price continues to hover below $0.20, and its future trend faces a critical decision: if it can hold the important support level, DOGE is likely to see a strong rebound, potentially challenging the high of $2.74; however, if market selling pressure continues to intensify, the price may further decline, targeting a low of $0.06.
Crypto analyst Ali Martinez pointed out that Dogecoin (DOGE) is currently at the lower edge of its ascending channel, an area that has historically triggered price breakouts. If the support level holds firm, DOGE could see a rise of 1450%, targeting $2.74; however, if it falls below $0.17, bullish expectations will be invalidated, and the price may drop to $0.06.
Technical indicators are releasing bearish signals.
Although Dogecoin (DOGE) has potential for long-term upward movement, short-term technical indicators have clearly shown signs of weakness. The activity on the Dogecoin network has significantly decreased, with the number of active addresses plummeting from 1.75 million in November 2024 to 87,100, reflecting a noticeable contraction in market demand.
From the 4-hour candlestick chart, DOGE is still in a downward channel, with resistance above at $0.22 and support below around $0.18. The Relative Strength Index (RSI) is below 50, indicating that the market is still dominated by sellers. Additionally, the Super Trend indicator has turned bearish, forming a red warning signal above the price. If the current downtrend persists, DOGE may further retrace to the range of $0.17 to $0.18, and may struggle to break through the resistance at $0.22.
Death Cross and Musk's Diminishing Influence
Elon Musk has been a key figure in driving the price of Dogecoin (DOGE) up, but his influence has significantly diminished recently. Since the beginning of this year, Musk's net worth has shrunk by $103 billion, and he is facing legal and political challenges, leading to a significant reduction in his interactions with DOGE. In the absence of Musk's enthusiastic support, there is considerable uncertainty about whether Dogecoin can maintain its strong momentum.
Meanwhile, DOGE's technical chart is about to form a 'death cross' — the 50-day Exponential Moving Average (EMA) crossing below the 200-day EMA, which is typically seen as a strong bearish signal. Looking back to July 2024, after a similar technical pattern appeared, DOGE's price plummeted by 40%. If history repeats itself, DOGE could drop to $0.1680, or in the most pessimistic scenario, fall to $0.08, with a potential decline of up to 60%.
Although the outlook for Dogecoin (DOGE) is filled with uncertainties, some analysts remain optimistic about its rebound potential. If DOGE can successfully hold the support at $0.17, it may trigger a rebound, targeting a price level of $0.22. However, if this critical support level is lost, market downward pressure will significantly increase, possibly leading to further sharp declines. The coming days will be a critical time window to determine the trend of Dogecoin, and market participants should closely monitor its price movements.
