DOGE Falls Below Critical Level: Is a Bigger Selling Wave Coming? - Coin Bulletin

Dogecoin (DOGE), on Monday, fell below the short-term uptrend line, indicating the end of the recovery that started from the lows of December.

This breakout signifies the potential end of the August-December rally and the possible strengthening of the downtrend.

The DOGE price fell below the 38.2% Fibonacci retracement level of the upward movement that started in August. According to the golden rule of technical analysis, this level needs to be maintained for a trend to continue. However, DOGE dropping below this threshold indicates strong signals that the current uptrend has ended.

The MACD histogram shows that the downward momentum is increasing by printing deeper bars below the zero line. In addition, the 5-day and 10-day simple moving averages have started to move downwards, indicating that the bearish trend is strengthening in the market.

Support Levels and Possible Scenarios

Critical support levels for Dogecoin are seen as **26 cents seen on December 20th ( and 23.4 cents ), which is 61.8% retracement level of the August-December rally(. If DOGE falls below these levels, selling pressure may increase further.

For DOGE to enter the upward trend again, it needs to surpass the upward trend line formed since December. Otherwise, the long-term bullish expectation may weaken, and investors should be prepared for larger declines.