Be A Good Boi! Why Dogecoin Must Hold This Key Support Level

Dogecoin DOGE/USD retested a key support level at $0.234 late Thursday afternoon after breaking up from a descending trendline Benzinga called out. The trendline has been adjusted slightly higher following the recent price action.

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The Dogecoin Chart: Dogecoin retested a support level but popped back up above the descending trendline. The retracement in price was on low volume, indicating the lower prices were due to consolidation.

When volume is low, it indicates a lack of both buyers and sellers in a stock or cryptocurrency. By Thursday evening, Dogecoin’s daily volume was just 1.72 million compared to the average 10-day volume of 5.26 million.

There is mild hidden bearish divergence on Dogecoin’s chart because, while the price of Dogecoin has fallen lower, the relative strength index has risen slightly. This indicates a bearish trend may continue before bulls come in to change the trend.

Dogecoin is trading below the eight-day and 21-day exponential moving averages (EMAs) with the eight-day EMA trending below the 21-day, both of which are bearish indicators. The crypto is also trading slightly below the 200-day simple moving average (SMA), which indicates overall sentiment slants bearish. On Thursday, Dogecoin attempted to break above the 200-day SMA but was rejected.

• Bulls want to see big bullish volume come in and bounce Dogecoin up from the back test of the descending trendline. The crypto has resistance above at the commonly-followed EMAs and the 27 cent mark.
• Bears want to see Dogecoin drop down below the descending trendline and for the crypto to trend underneath it until losing psychological support at the 20-cent level. Below the area, Dogecoin has support at 16 cents.