Dogecoin Price Trends: A Perilous Dance with Support and Resistance
The price movement of Dogecoin (DOGE) against the US Dollar is currently ambiguous but exhibits a pronounced bearish trend when juxtaposed against Bitcoin (BTC). Several DOGE/BTC indicators suggest a downward momentum, necessitating a robust rebound and recovery to counter this bearish forecast.
Technical analysis on a weekly timeframe reveals that DOGE has dipped below a descending resistance line since attaining its peak price of $0.739 in May 2021, which led to a trough of $0.049 in June 2022. Subsequently, the price of DOGE witnessed a resurgence, trading above the $0.060 horizontal support level. Yet, it hasn’t triumphed over the longstanding descending resistance line, which has held its ground for 798 days.
A recent attempt to break out of this resistance was thwarted last week, but DOGE is currently making another bid. Interestingly, the price trades perilously close to the meeting point of the horizontal support level and the descending resistance line, hinting at a substantial price movement in the offing.
Uncertainty Looms: RSI Readings Offer No Clear Outcome
The weekly Relative Strength Index (RSI) readings present no clear conclusion. The RSI, a momentum indicator that traders employ to discern whether a market is overbought or oversold, does not decisively favor either bulls or bears. Readings above 50 with an upward trend would suggest bullish dominance, while readings below 50 would imply a bearish market.
Currently, the RSI is climbing but remains under 50, indicating an unclear trend. To corroborate a bullish trend, the RSI would need to climb above 50 and DOGE would need to break free from the descending resistance line.
DOGE Falters Against BTC
While the DOGE/USDT chart remains inconclusive, Dogecoin is ceding ground against Bitcoin. The weekly chart reveals that the DOGE/BTC price has settled below the ₿0.0000023 support zone, which is pivotal as it has alternately served as resistance and support since the commencement of 2021. Thus, a close below it would strongly suggest a bearish trend and the onset of a downward trajectory.
This bearish sentiment is further buttressed by the RSI readings. The RSI plummeted below 50 at the start of the year and has been on a downward spiral since, which are both perceived as bearish indications.
However, should DOGE ascend above the ₿0.0000023 zone, it would invalidate the bearish forecast, potentially accelerating the rate of increase to ₿0.0000040.
