In early trading this morning, DOGE/USD has managed to traverse slightly above the 17 cents level, after three days ago trading below 14 cents. Only two days ago, DOGE/USD was barely trading above the 14 cents mark, but it was able to sustain short-term support and did begin to climb slightly higher. The move in Dogecoin correlates to other major cryptocurrencies which have been able to gain the past couple of days.
Optimistic bullish traders may believe that the depths hit only three days ago represent the final surge lower in an oversold cryptocurrency market. If they are correct and remain active buyers within the current lower price range Dogecoin is traversing, these bullish speculators may be rewarded with profits. If the 17 cents level can be sustained near term and begin to challenge the 17 and half cents and higher ratios, buyers could start to believe the bearish trend has ended.
However, DOGE/USD remains within the bottom tier of its values when looking at a long-term chart, its ability to trade near 14 cents touched a price seen early in December. The ability of DOGE/USD to retest lows may in early December when it flash crashed with an incremental move lower this time around just a few days ago could be a troubling sign. Bearish traders may view the recent climb of DOGE/USD as a false rally, one that will run out of steam and begin to reverse lower sooner rather than later. The last time DOGE/USD sincerely traded below 14 cents for a duration was in April of 2021.
The next few days of trading in the broad cryptocurrency market and DOGE/USD will likely be a game of ‘who do you trust’ as behavioral sentiment gets tested. The bearish trend, which has developed the past few months in Dogecoin, has tested the fortitude of its influencers who may be having their own troubles if they bought DOGE/USD when it was within over exuberant heights during 2021.
DOGE/USD needs to have solid risk management and it remains a volatile speculative asset. Moves over 10% in value are commonplace, and within the lower values Dogecoin is now trading slight spikes can prove wildly profitable or very costly mistakes. Wagering on upside momentum may be tempting, but stop loss orders need to be implemented to guard against the potential for more tests downward. Traders should keep their target prices realistic too.
Dogecoin Short-Term Outlook
Current Resistance: 0.17500000
Current Support: 0.16500000
High Target: 0.18540000
Low Target: 0.14850000
