Dogecoin hasn’t been able to recover from the negative price shock it received yesterday – the cryptocurrency came down with a thud from 50 satoshis to 46.3 satoshis – and is currently trading near 1-week lows. I had earlier mentioned that maybe it’s best to sell now and go away until depressed levels of Dogecoin are seen; I still maintain that the crypto coin might depreciate in value going forward.
Currently, Dogecoin is trading down 1.875% or 0.9 satoshis at 47.1 satoshis from yesterday’s observation.
Image: https://www.tradingview.com/x/pFkivPAh/
An analysis of the 240-minute Dogecoin/Bitcoin price chart above reveals information of high importance to the market participants.
Dogecoin Chart Structure – The region around 46 satoshis has been acting as a support zone for the cryptocurrency for some time now. As can be seen, Dogecoin has taken support from 46.3 satoshis at least 4 times (marked in the chart), stamping it as a strong floor. However, repeated plunging of Dogecoin to these levels also signifies that the bears are going aggressive and that the floor might crumble if the selling pressure is increased.
Bollinger Bands – The lower range of the BB has coincided with the floor value. A breach of these support levels would lead to a severe loss in the market cap of Dogecoin.
Relative Strength Index – That current scenario is slightly skewed in favor of the sellers is also justified by the RSI indicator reading of 46.9993. A value below 50 is generally seen as bearish.
The bears have once again beaten the bulls to the ground, further reinforcing their dominance. Therefore, it is best to stay on the short side of the trade – build short positions on any rise up to 50-51 satoshis for a target of 47 satoshis. A break below 46 satoshis should be viewed as an opportunity to exit the counter. High volatility may also rock the Dogecoin market pretty soon.
