After the recent market-wide selloff, Dogecoin has come under heavy pressure, suffering a 20% decline from its local highs. Despite the fall, the popular meme coin still has a supportive structure, keeping investors optimistic about the possibility of a recovery. However, the current levels are crucial, as Dogecoin is testing key areas of demand that could determine its next move.
Related Reading
BigCheds chief analyst and trader recently shared a technical analysis on X, indicating that DOGE is testing critical demand at $0.31 on the daily time frame. Historically this level has been a strong support area, and holding above it could set the stage for a bounce and continuation of its bullish trend. On the other hand, if this level is not maintained it could open the door to a lower rate.
Market sentiment remains cautious following the decline in the broader crypto market, but DOGE has the ability to maintain the current levels could restore investor confidence. All eyes are now on whether the meme base can defend this key support and potentially pave the way for a new rally or whether additional selling pressure will lead to a deeper correction.
Dogecoin maintains significant support as 2025 begins
The beginning of 2025 has taken a different tone for Dogecoin compared to the explosive end of 2024. Starting in early November, there was a huge increase in DOGE prices, gaining more than 230% in less than three weeks . This meteoric rise saw the meme coin reach significant levels, reigniting interest and optimism among investors. However, since finding a local high, Dogecoin has entered a consolidation phase, testing critical support levels.
Today, the Dogecoin exchange rate has increased against the US dollar main daily demand level indicated by the main analyst BigCheds. In his recent technical analysis, BigCheds emphasizes the importance of this support area, because it could determine the next big move for the cryptocurrency. If DOGE continues to hold above $0.31, it sets the stage for a break into higher prices, ruling the bullish trend seen at the end of 2024.
Traders and investors are closely watching this level of consolidation, as Dogecoin's ability to maintain its support structure depends on this level. A clean bounce from the $0.31 bid could trigger renewed buying pressure, propelling DOGE towards new highs. On the other hand, the loss of this critical support may lead to a deeper correction, testing lower levels before reversing.
Related Reading
As the broader market is also finding its footing, Dogecoin's performance at this important level is likely to influence its trajectory for the coming weeks. A successful defense of $0.31 could mark the beginning of another significant rally, reinforcing DOGE's position as a leading contender in the cryptocurrency space.
DOGE Eyes A Breakout
Dogecoin is currently trading at $0.33, showing resilience after holding above the $0.31 critical demand level. This support has provided the basis for stabilizing DOGE after the recent market selloff. However, the cryptocurrency remains at risk as long as it continues to trade below the $0.40 mark, a level that could bring back a strong move.
For bulls to regain control, the price must definitely recover $0.40. This would signal a shift in sentiment and provide the momentum needed to challenge the $0.43 mark. A break above $0.43 is an important milestone for Dogecoin, as it is likely to trigger a massive rally into price discovery, attracting renewed interest from investors and traders.
Related Reading
On the other hand, if you do not get back $0.40 in the short term DOGE is vulnerable to further downsides. Trading far below this level increases the risk of a deeper correction, which could test lower levels of demand. The next few days will be crucial for Dogecoin's trajectory, as broader market sentiment and DOGE's ability to regain key levels will determine its direction.
If bulls succeed in pushing above $0.43, the meme coin could move quickly, cementing its place as a market leader in this cycle.
Featured image from Dall-E, chart from TradingView
