Dogecoin Holds Bullish Bias Despite Brutal Overnight Crash; What’s Next?

Dogecoin Holds Bullish Bias Despite Brutal Overnight Crash; What’s Next?
Image by Free-Photos from Pixabay

Yerevan (CoinChapter.com) – Dogecoin (DOGE) has experienced a 15 percent crash overnight, currently trading at $0.44 in the Frankfurt session Thursday. Despite the decline, the token might still have a chance to recover and maintain its prevailing bullish sentiment.

What Affected Dogecoin?

Dogecoin’s pattern of bullish and bearish cycles coincided with the hype created around the token across social media platforms.

The so-called DOGE army included high-profile proponents. One of them was Elon Musk, the multibillionaire founder of SpaceX and Tesla. Meanwhile, the other famous Dogecoin flagbearer was Mark Cuban, the owner of NBA’s Dallas Mavericks. They tweeted about the meme token constantly and propelled its prices up by more than 19,000 percent at one point in time this year.

Read more: Elon Musk Saves Dogecoin Price From Crashing — All Over Again

However, Mr. Musk’s latest Dogecoin boosting attempts backfired, as the price dropped drastically after his guest appearance on Saturday Night Live. Bulls had pumped Dogecoin by up to 24 percent two days before the show. But Mr. Musk called the token a “hustle” on-air, causing panic-sell across the Dogecoin spot and perpetual markets. The value of Doge has been declining ever since, albeit choppily.

The Tesla CEO further defied his earlier stance on Bitcoin (BTC) by announcing that Tesla will no longer accept cryptocurrency payments for their electric vehicles. In hindsight, the electric car giant had adopted the Bitcoin payments only a month ago.

Read more: Tesla Posts Record Net Income Due To Bitcoin Sales

However, Mr. Musk is worried about the ecological repercussions of BTC mining as he tweeted the following:

On a more positive note for Dogecoin supporters, the entrepreneur’s other company SpaceX announced that the new commercial payload to the moon on its Falcon 9 rocket would be paid entirely in Dogecoin.

What’s Next?

Despite the sharp decline, Doge still has a chance to recover, given the support lines on the chart below.

Dogecoin dropped 15% overnight. Source: DOGEUSD on TradingView.com
Dogecoin dropped 15% overnight. Source: [DOGEUSD] on TradingView.com

Dogecoin price dropped below the 20-day Exponential Moving Average (EMA 20; blue line) on May 9 and hasn’t fully recovered since.

If the value doesn’t rebound from the $0.41 price line, the next support opportunity is at $0.34. It is likely to act as a rebound level since it also sits right around the 200-day Moving Average (light blue wave on the chart). The minimal value support lies at the $0.24 value, which has reversed downside attempts earlier this year.

Meanwhile, the declining resistance line is currently capping the uptrends, but DOGE has all the chances to break back above the EMA 20.

As hard as it is to make predictions when it comes to Dogecoin, the 4h chart currently indicates a possible bullish trend in the future. However, given its main proponent’s recent decisions, the opposite outcome is also a possibility.

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