The price of Dogecoin (DOGE) has dropped nearly 12 percent in the last week as the cryptocurrency market continues to experience massive drops. Despite this drop in the price of the meme coin, its 24-hour volume was observed to increase. Analysts believe Dogecoin is in a downtrend.
Dogecoin price may continue its downtrend
As the crypto market crash continues, Dogecoin (DOGE) experienced a surge in on-chain activity after losing around 5.3 percent of its market cap. Despite the price drop, Dogecoin trading volume increased by nearly 200 percent overnight. According to data released by Cointrendz, Dogecoin has emerged as one of the trending cryptocurrencies on Twitter. With the recent price drop of Dogecoin and the continuation of the downward trend, $13.69 million was liquidated in DOGE futures.
Renowned cryptocurrency analyst Michaël van de Poppe believes we are nearing the end of the downtrend. According to the analyst, given that altcoins have been in a bear market for over a year, capitulation may have already taken place. Analysts believe that the losses in the Dogecoin price have come to an end and set an average price target of $0.14 per DOGE. Meme coin is preparing for a bullish boom, one of the most used smart contracts among Ethereum whales. Cryptocurrency analyst Nica Osorio pointed out a few market catalysts in the Dogecoin chart that indicate it is heading towards a breakout in the coming weeks. Osorio said that a descending wedge pattern is formed on the Dogecoin price chart and he thinks that the trend will reverse…
descending wedge view on the DOGE chart
As we have reported on the DOGE weekly chart, these swing points are using the trend lines on the DOGE weekly chart. When combined, the descending wedge pattern is defined. After six failed attempts, DOGE has returned to retest the $0.109 to $0.124 weekly support zone. Considering the bearish trend of the crypto markets, if this drop breaks the $0.109 level, it could lead to a disastrous collapse.
Such a move 30 percent towards the $0.078 level where buyers can step in. It could trigger a pullback. This move will invalidate the ascending thesis of the descending wedge. Worse, a break of $0.048 on a weekly timeframe could be a crucial point. This move could trigger a further 70 percent drop due to the fair value gap stretching from $0.041 to $0.014. A weekly candlestick above $0.159 on the Dogecoin chart confirms a bullish breakout. This development will also invalidate the bearish thesis and trigger a move that retests $0.217.