Dogecoin price is experiencing a temporary decline following its latest climb to a local peak, while technical signals suggest an uptrend is on track.
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At the time of writing, DOGE is trading at $0.09448, down 7.51% over the last 24 hours. Its 24-hour trading volume stands at around $2.96 billion, while its market capitalization is approximately $14.81 billion.
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Dogecoin Price Eyes Support After Pullback
This current drop occurs following a rise in DOGE and reaching a resistance zone. Instead of seeing the correction as a breakdown, Trader Tardigrade pointed out that the $0.087 zone was a key price level for the upcoming move.
Trader Tardigrade expressed on September 24 that the latest pullback may be considered a natural part of consolidation within the uptrend.
The analyst believes that DOGE had formed a local high close to the resistance level, which created conditions for taking profit. The current correction will allow forming another base before making any attempts to go higher.
The critical point to look out for is $0.087. According to Trader Tardigrade, this range may be considered a consolidation level that will help Dogecoin stabilize prior to a further bullish rally.
The breakdown through this level would become very important for the price chart of Dogecoin. In case DOGE manages to hold above this level, the current rebound pattern would remain untouched. On the contrary, if there is any breakdown below this level, then the entire structure would come into question.
There are indications of support at the $0.087-$0.091 level in the market analysis lately.
DOGE Technical Indicators Still Show Buying Strength
The momentum indicators also back up the existing setup for the recovery.
First, the MACD line is 0.00319, which contrasts with the signal line that is 0.00213, resulting in the histogram value being 0.00106. With the MACD still above the signal line, the indicator continues to show positive momentum.
Second, the Relative Strength Index (RSI) continues to be above its neutral value. The RSI of DOGE is 60.32, and the average RSI is 54.81.
When the RSI value is above 50, the buying pressure is stronger than the selling pressure, while a value less than 70 indicates that DOGE has not yet entered overbought territory.
Considering the above-mentioned technical indicators, the ongoing downtrend has failed to negate the positive momentum present in the overall outlook.
However, the technical indicators tend to change very quickly during the correction process. Therefore, the level of $0.087 becomes more important at this juncture.
DOGE ETF Inflows Add Another Demand Signal
The technological infrastructure is also being developed alongside renewed focus on spot Dogecoin ETFs.
In this context, crypto analyst TOP DOGE has emphasized the existence of an extra $1.2 million worth of inflows into spot DOGE ETFs, although he has also indicated more than $2 million in weekly net inflows. The analyst has also stated that the ETF holdings account for only about 0.11% of the circulating DOGE supply.
These numbers indicate a relatively small but still important source of demand. Through spot ETFs, investors gain access to DOGE without having to buy and hold the cryptocurrency.
What Happens Next for Dogecoin Price?
The most critical level of resistance for Dogecoin’s price going forward will be its ability to maintain the support area of $0.087 amid the current correction.
If managed successfully, then DOGE may have enough time to consolidate before making its next run at the prior highs. A combination of positive MACD and RSI above 50 would reinforce such expectations.
However, if DOGE falls below $0.087, it might mean that the current technical pattern is going to change.
The key factors at present are support at $0.087, momentum of MACD, strength of RSI, and continuous purchases of ETFs. These factors will help decide whether the present correction will turn out to be a consolidation or will develop into something else.
The general idea here is that there is renewed interest in the coin from the market, although the recovery has yet to be confirmed.
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