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Popular memecoin Dogecoin‘s (DOGE) price experienced a significant break below an important support trend line that has been sustaining the ongoing relief rally for the past three weeks on September 12th. Although such a break typically indicates a stronger downtrend, the sense of recovery caused by Bitcoin‘s (BTC) jump from the $25,000 level has mitigated the decline of the memecoin, resulting in a sideways movement of the price. Currently, the price chart shows short-bodied candles, indicating uncertainty and indecision among traders.
Downtrend Could Push the Price Below $0.06
Taking advantage of the bullish sentiment in the market, Dogecoin’s price has increased by 5.3% from $0.06, a psychologically significant level, in just six days and is currently settled around $0.0621. It is noteworthy that this rally remained within the boundaries set by the crash candle on September 10th. This situation has turned $0.063, the highest level of the candle, into a strong resistance point, while $0.053 has become a strong support level.
If the upward momentum continues, it would not be surprising for DOGE to rise by approximately 4% and encounter the descending resistance trend line. This descending resistance trend line, which the memecoin has bounced off three times in the past month, indicates that traders could sell during the upward recovery.
If investors face significant selling pressure around this resistance trend line, it could pave the way for a more pronounced downtrend and potentially cause a 11% drop, bringing the memecoin’s price to $0.056.
Could DOGE Price Rise to $0.077?
For those expecting an uptrend in Dogecoin, the most strategic move would be to wait for a convincing breakout beyond the mentioned resistance trend line. In such a breakout, the resistance trend line will be retested as potential support, and the price will enter the $0.077 range, opening the way for an upward movement of approximately 18%.
Furthermore, on the daily timeframe price chart of the memecoin, it can be seen that both the upper and lower limits of the Bollinger Bands indicator are moving in balance. This is a clear indication of uncertainty in the Dogecoin market. Moreover, the downward slopes of the Vortex Indicator’s VI+ (blue) and VI- (orange) on the same timeframe suggest that sellers are dominant in influencing the price of Dogecoin.
