20 December 2024
The entire crypto market has been riddled with a notable decline in the past 24 hours, led by Bitcoin’s break below the $100,000 price level again. Dogecoin wasn’t left out of this decline, which saw its price crashing by almost 15% and eventually reaching below $0.31. However, technical analysis suggests that this price decline is very natural in Dogecoin’s current trajectory. This technical analysis offers a silver lining for Dogecoin enthusiasts, as it frames the pullback as a natural phenomenon within the broader ongoing bull cycle.
Weekly Golden Cross And Its Implications For The Dogecoin Price
Crypto analyst Kevin (Kev_Capital_TA) took to the social media platform X to highlight the significance of Dogecoin’s weekly golden cross amidst the ongoing market downturn. According to Kevin, Dogecoin experienced a weekly golden cross back in early November, coinciding with the US election period. Historically, such technical indicators signal strong bullish momentum to the upside. However, Kevin noted that the current pullback aligns with past patterns where Dogecoin underwent significant corrections following golden crosses.
He pointed out that in previous cycles, Dogecoin faced three separate 50% corrections on its path to conclude at a cycle top. This historical behavior provides context for the recent crash to $0.31, which, according to Kevin, is a typical bull market pullback. He emphasized that this kind of retracement is not only expected but also essential for maintaining the market’s bullish structure.
Support Levels And The Golden Pocket Zone
Kevin’s technical analysis further looks into Dogecoin’s key support levels that could determine the meme coin’s next move. To get these support levels, he outlined the macrostructured support zone and the golden pocket, which is a Fibonacci retracement zone widely regarded as a strong support area. Based on his assessment, a 45% correction from Dogecoin’s recent high would align with these levels and could set the stage for a resumption of the uptrend.
With that in mind, the recent Dogecoin price high is just around $0.48, a price point that it achieved in early December. Should Dogecoin tap into this golden pocket zone without closing below the $0.26 level on a weekly basis, this should be enough to keep the bullish market structure intact. However, breaking below support at $0.26 could spell trouble for Dogecoin, and cause a shift in its price trajectory in the broader trend.
At the time of writing, Dogecoin is trading at $0.3179, marking a steep 12% decline in the past 24 hours and an even more significant 22% drop over the past seven days. This recent decline places Dogecoin at its lowest level since early November, breaking below the $0.35 threshold for the first time in over a month. Nevertheless, the $0.26 support level will remain a focus in determining whether Dogecoin’s bull run is still valid.