Dogecoin reversal after a bearish weekend suggests a potential bounce back to $0.19, with a post-retest recovery from a falling channel pattern.
As the crypto market gradually gains bullish momentum this week, Dogecoin has risen by nearly 3% in the past 24 hours. Currently trading at $0.1705, Dogecoin holds a market cap of $25.35 billion.
However, the overall meme coin market has dropped to $48.95 billion, recording a nearly 15% decline over the past 30 days. As meme coins remain highly volatile, will the short-term recovery lead to a bounce above $0.20 in DOGE prices?
Dogecoin Price Analysis Hints Post-Retest Bounce Back
On the daily chart, Dogecoin’s price action shows a bullish breakout from a falling channel pattern. However, the recovery failed to overcome the bearish pressure at the 23.60% Fibonacci level at $0.1945.
After approaching $0.20, a tweezer top reversal triggered a four-day correction for Dogecoin. With consecutive bearish candles, Dogecoin dropped by nearly 15%.
However, this pullback may represent a potential retest of the broken falling channel pattern. Dogecoin formed a Doji candle after a lower price rejection at $0.16 on Monday.
The resurgence of bullish momentum has sparked a 2.23% intraday recovery, hinting at a potential morning star pattern formation.
Despite this, the 100- and 200-day EMA lines are approaching a negative crossover, signaling bearish pressure. Additionally, the recent short-term pullback has significantly weakened bullish momentum.
The MACD and signal lines also warn of a negative crossover as the bullish histograms decline. As a result, technical indicators still lean bearish due to the prevailing downtrend.
Elon Musk Behind the $0.16 Retest
Notably, Dogecoin’s short-term recovery reflects a swift turnaround following a recent hit from Elon Musk. The American billionaire and chairperson of the Department of Government Efficiency recently stated during a town hall meeting:
“As far as I know, there are no plans for the government to use Dogecoin or anything similar.”
This statement triggered the recent drop to $0.16. However, Dogecoin has since bounced back and is hinting at a potential recovery this week.
Key Price Levels For Dogecoin
Based on the price analysis, the post-retest reversal from the falling channel pattern is likely to challenge the 23.60% Fibonacci level at $0.1945 again. This suggests an upside potential of nearly 15%.
If the recovery extends, the uptrend could reach the 38.20% Fibonacci level at $0.22, offering a 32% bullish potential. On the other hand, a decline below the broken resistance trendline would put pressure on the $0.15 psychological support level.
DisClamier: This content is informational and should not be considered financial advice. The views expressed in this article may include the author's personal opinions and do not reflect The Crypto Basic opinion. Readers are encouraged to do thorough research before making any investment decisions. The Crypto Basic is not responsible for any financial losses.
