- Dogecoin price retreats from a 7.5-month high following a failure to cross multi-month resistance.
- Stochastic pullback from overbought territory adds weight to DOGE’s slide toward a four-month horizontal support area.
- Key EMAs, Dogecoin Treasury news defend three-month uptrend, despite short-term pullback risks.
- DOGE rebound needs validation from $0.2950 and FOMC to convince buyers.
Dogecoin (DOGE) falls over 5.0% intraday, extending its weekend pullback from a 7.5-month high to $0.2635 on the week’s first trading day.
The popular memecoin’s latest retreat could be linked to its failure to cross an ascending resistance line from March, as well as the Stochastic momentum indicator’s pullback from the overbought territory, as the market braces for the U.S. Federal Reserve’s (Fed) interest rate announcement, scheduled for September 17.
Apart from that, upbeat trading volume also validates the DOGE pullback, even as the market capitalization retreats from a multi-month high. That said, DOGE’s daily trading volume remains firmer around $6.44 billion, rising back towards a 7.5-month high after Sunday’s retreat. That said, Dogecoin’s market cap eased from the highest level since early February to $40.08 billion, both teasing sellers, according to Santiment data.
Still, headlines surrounding the DOGE Treasury, a four-month horizontal support area, and the quote’s sustained trading beyond the key Exponential Moving Averages (EMAs) keep the buyers hopeful.
Also read: What is Fueling Dogecoin (DOGE) Price Upside This Week? Read Here!
With this, the DOGE’s short-term weakness can’t be ruled out, even if the three-month recovery looks strong, keeping hopes alive for reversing the yearly loss.
Dogecoin Price: Daily Chart Lures Sellers
Dogecoin’s clear U-turn from the March resistance line, close to $0.2930, joins the Stochastic retreat from the overbought territory to keep short-term sellers hopeful of visiting a four-month horizontal support area around $0.2550-$0.2500.
However, the quote’s further downside appears difficult as an ascending trendline from late June joins the 100-day EMA to highlight $0.2200 as the key support level.
The 200-day EMA also acts as an additional downside filter near $0.2150, a break of which could direct sellers toward the previous monthly low near $0.1880.
However, the memecoin’s weakness past $0.1890 makes it vulnerable to slump toward the multi-month trading range’s support line surrounding $0.1430.
On the contrary, Dogecoin’s fresh recovery may initially aim for July’s peak of $0.2875 before marking another battle with the multi-month resistance line surrounding $0.2930. Also acting as an immediate resistance is the latest peak near $0.2950 and the $0.3000 threshold.
Should DOGE buyers keep the reins past $0.3000, the monthly high near $0.3070 could act as the final defense of the sellers before activating a gradual rise toward the yearly peak surrounding $0.4340.
Dogecoin Price: Four-Hour Chart Highlights Multiple Supports
Dogecoin’s failure to stay beyond an eight-week horizontal resistance, surrounding $0.2850-$0.2860, joins the quote’s latest downside break of a week-long ascending trend line to lure the short-term sellers.
However, the 50-bar EMA and the nearly oversold Stochastic conditions restrict the DOGE’s further downside to around $0.2590.
Also challenging the sellers is the 200-bar EMA of $0.2345 and a slightly descending trend line from July 11 around $0.2040.
Given the quote’s weakness past $0.2040, which is less likely, the triangle’s bottom of around $0.1890 will be the last defense of the buyers before targeting the yearly low of near $0.1430.
Meanwhile, the DOGE recovery may initial aim for the support-turned-resistance line surrounding $0.2730 before approaching the multi-week resistance area near $0.2850-$0.2860. Beyond that, the daily chart’s higher levels will be in the spotlight.
Conclusion
Dogecoin’s recent pullback approaches a key horizontal support as the market consolidates after the coin failed to break a multi-month resistance. However, the downside room seems to be limited due to multiple support levels, positive sentiment around the memecoin’s corporate treasury, and hopes for Fed rate cuts.
Hence, the DOGE may test its short-term support, but a deeper drop looks doubtful unless new negative fundamentals emerge. With this, the coin traders should stay cautious while keeping the overall bullish outlook in mind.
Also read: Cryptocurrency Weekly Price Prediction: BTC, ETH, XRP Rally as Markets Bet Big on FOMC Rate Cuts
