Dogecoin (DOGE), the meme-based cryptocurrency, has recently seen a sharp decline in price following a short rally to $0.12 last week.
Amid this plunge in price performance, prominent crypto analyst Ali has identified key levels where its price needs to be reclaimed real soon, or there will be negative consequences.
Dogecoin: Reclaim $0.11 Or What?
In a recent post on Elon Musk’s social media platform X, Ali highlighted the importance of the $0.11 price mark for Dogecoin, noting that approximately 60,210 addresses had purchased around 36.40 billion DOGE tokens at this level.
He explained that these addresses represent significant support, and if the price remains below $0.11, holders might become increasingly inclined to sell their assets to mitigate potential losses. This selling pressure could accelerate DOGE’s downward trend.
60,210 addresses bought 36.40 billion $DOGE at $0.11! #Dogecoin must reclaim this level soon to sustain a bullish outlook. Otherwise, a failure to do so could lead to a sell-off as investors may seek to minimize losses. pic.twitter.com/BABwVfPGem
— Ali (@ali_charts) October 3, 2024
DOGE’s Ongoing Decline: Beginning Of Another Bearish Trend?
So far, Dogecoin has been on a downward trajectory, losing a significant portion of its gains from its recent rally. Over the past week, DOGE has dropped by 10.8%. The decline has continued into the past 24 hours, with the asset shedding 4.2% of its value, currently trading at around $0.1019.
This price drop has directly impacted DOGE’s market capitalization, falling from over $17 billion last Thursday to around $14.9 billion today. Alongside this, the 24-hour trading volume for DOGE has also seen a noticeable decrease, from $1.4 billion last Thursday to just above $1 billion.
While many in the crypto community are panicking concerning this bloodbath, analysts have continued to share their outlook and remain optimistic.
For instance, Trader Tardigrade, a popular crypto analyst, in a recent post on X, suggested that the recent dip in Dogecoin’s price may be a “retest” of its descending trendline following a recent breakout.
According to Tardigrade, Dogecoin’s relative strength index (RSI), which measures the magnitude of recent price changes, shows a lower low while DOGE maintains a higher low position.
According to technical analysis, this divergence could indicate a possible trend reversal in favor of a bullish move. Tardigrade concluded the post with advice noting: “Understand the TA [technical analysis], and you won’t be shaken out.”
Featured image created with DALL-E, Chart from TradingView