Dogecoin Clipped, is DOGE/USDT Descending Back to Earth?

Dogecoin is in a precarious position at the time of writing.

While buyers have been dodging bear salvos in the past few days, the uptrend appears weak and bulls exhausted.

As a result, this weakness has seen prices retrace from August 2021.

Worse, DOGE prices are on the brink of sinking below the primary support level—the 20-day moving average—for the first time in over four weeks.

It could remarkably be the turning point for Dogecoin bulls and possibly the beginning of another wave lower mirroring price action of Q2 2021.

That’s the reason why Dogecoin chartists are closely monitoring how today’s close will be and the level of participation behind the down bar.

Dogecoin Market Performance and Price Status

Presently, the Dogecoin market cap is down 10 percent, while DOGE prices trail the USD, ETH, and BTC on the last trading day.

Discouragingly–and this is a primary cause of concern–is the sharp dip in trading volumes.

Over the last 24 hours, DOGE trading volumes are down over 25 percent, according to trackers, falling to $2.5 billion.

It is a marked contraction pointing to trader apprehensiveness and fear of more losses considering the position where DOGE price action is at.

Technically, for trend continuation, Dogecoin bulls must rebound back from the 20-day moving average to above $0.35.

Additionally, the upswing must have high trading volumes, only indicating optimism and confidence in the uptrend.

Though likely to pan out over days, such a move should comprehensively reverse losses of August 24 and drive prices back above the 20-day moving average, signaling strength.

If not, Dogecoin prices might plunge towards $0.15, a possibility if today’s bulls don’t soak the selling pressure of early this week, rewinding August 24 losses.

This uncertainty forces traders to play with their cards close to their chest, preferably until a clear trend develops.

Dogecoin Resistance at $0.35

A trader on Twitter has highlighted the significance of the resistance line.

$DOGE The rising 20-day exponential moving average ($0.28) and the RSI in the positive zone indicate that bulls have the upper hand. If the price sustains above $0.29 for a few more days, the buyers will again try to resume the uptrend by thrusting the #DOGEUSDT pair above $0.35. pic.twitter.com/lislOAQ6oy

— RESEARCH 24/7 (@smallcappick) August 23, 2021

Specifically, the analyst notes that the DOGE/USDT uptrend will only be validated by a sharp close above $0.35—the liquidation line marking the accumulation of the past few days.

For now, the dip below the 20-day moving average—the flexible support level—affirms the waning upswing and lower lows versus the upper BB of the last few days.

DOGE Bullish, Target remains at $1

Meanwhile, regardless of the selling pressure, another trader is optimistic of trend continuation to the upside in subsequent sessions. The analyst’s target is at $1, a point at which DOGE will strike parity with the USD.

$DOGE short fall to $0.27 quickly rebounded to $0.29, currently in the 120-day SMA below the pressure level, continued bullish $DOGE, target $ 1, support $ 0.255, pressure $ 0.31.#dogecoin #DOGEUSDT #Dogecoins @elonmusk pic.twitter.com/ID2zvVX1KG

— Crypto Line 📈 (@CryptoLinns) August 24, 2021

Although ambitious, the lofty level can only be achieved once Dogecoin bulls’ clear immediate liquidation barriers and $0.80.

Before then, candlestick structure indicates weakness, although project fundamentals are rock solid.

Dogecoin “Going to the Moon”

But ONLY once bulls cruise past $0.35.

It is the view of one trader on Trading View who once more reiterates the significance of August 2021 highs.

The trader says Dogecoin bulls must overcome this level for new support to be created at $0.35, a base for a moonshot to $0.45—nearly half of H1 2021 peaks.

Charts courtesy of Trading View

Disclosure: Opinion is that of the author. Do your own research.