Dogecoin demonstrating strong declines, weaker recovery tips bearish action ahead

dogecoin doge elon musk
Image by Tumisu from Pixabay
  • Doge daily chart analysis reveals several significant support/resistance margins.
  • Where is Elon Musk?
  • What is in store for Dogecoin?

Yerevan (CoinChapter.com) – Dogecoin prices declined heavily at the beginning of this week. The meme cryptocurrency recovered 46.73% to $0.22 on Wednesday after bottoming out at $0.15 in the previous session.

Should the uptrend continue, the next obstacle on the way is the support/resistance margin of $0.25, which DOGE lost on Monday. If the meme-token retests the margin successfully, Dogecoin might approach the downward sloping resistance line that capped its bullish attempts since early May.

Also read: Dogecoin couldn’t dodge the bearish bullet—24% value wiped in 24 hours

Dogecoin daily chart. Source: DOGEUSD on TradingView.com
Dogecoin daily chart. Source: DOGEUSD on TradingView.com

If the uptrend is unsuccessful, and Dogecoin decline resumes, it is likely to drop back to the 200-day simple moving average (SMA-200: yellow wave). The SMA-200 is the last significant support Dogecoin could hope for before crashing back to mid-April levels.

However, there are crutches still in store for the meme-coin. Should DOGE drop below the SMA-200, it could face the support of the $0.091 line, which is a resistance margin from mid-February. If all else fails, Dogecoin could retest the $0.047 and $0.040 support levels soon enough.

Where is Elon Musk?

Dogecoin is famously propelled by the billionaire entrepreneur Elon Musk. The chief executive has been surprisingly silent on the recent crypto crash, except for one tweet reply. Ross Nicoll, one of Dogecoin Core developers, tweeted about doing the second run-through of a fee-reduction code. Mr. Musk responded with a reserved reply and called it an “important improvement.”

dogecoin, Dogecoin demonstrating strong declines, weaker recovery tips bearish action ahead

This reply might be one of the reasons Dogecoin flashed a green candle after a devastating crash. However, if the ‘Dogefather’ would have been more vocal on his favorite coin during the crash, it might have avoided a 37 percent decline on Monday.

The reasons lie in the recent market history. The DOGE/USD rate soared by 41 percent in the session preceding Elon Musk’s appearance on the SNL show on May 8. The billionaire tweeted the following:

Another tweet, raised the meme-coin value by 20 percent on May 24, when the billionaire urged the Dogecoin community to brainstorm over possible improvements to the blockchain.

Also read: Dogecoin, Elon Musk’s pet crypto, dips drastically amid global market correction

What to expect for Doge?

Dogecoin flashed signs of bullish recovery. However, given the overall devastating state of the crypto market, a bearish continuation is more likely. There are still faithful Dogecoin holders left, like Glauber Contessoto, who chose to keep his prized assets in DOGE, despite losing $167k in a single day.

The bullish scenario doesn’t sound too convincing to some experts. One of them is an analyst with a Twitter handle Livercoin. He predicted the price dropping down to $0.08.

Moreover, Bitcoin declines at a slower rate than smaller altcoins. The outlook for Shiba-Inu coin becomes more bearish, as it’s losing value faster than Bitcoin, making the latter a safe haven in the crypto market.

Also read: Even Elon Musk’s tweets couldn’t save Dogecoin from crashing

Should Dogecoin decline further, it still has several potential support margins on its way, that could shift allegiance and serve as resistance. The upcoming sessions will shed light on the future developments, as the market attempts to recover.

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dogecoin, Dogecoin demonstrating strong declines, weaker recovery tips bearish action ahead

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