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Dogecoin (DOGE) has just completed its first bearish crossover in August, forming a death cross pattern on its four-hour chart. The signal, which comes when the short-term 50-period moving average falls below the long-term 200-period moving average, is commonly interpreted as an indication of declining momentum and potential further downside.
In the case of Dogecoin, the four-hour simple moving average (SMA) 50 has dropped below the four-hour SMA 200, indicating that short-term selling pressure is outweighing demand. DOGE has been under pressure in recent weeks, unable to maintain upward momentum amid a broader market sell-off spurred by macroeconomic concerns.
Dogecoin declined from a high of $0.287 on July 21 to a low of $0.1888 on Aug. 3 to begin the month on a shaky note.
Dogecoin is currently trading at $0.2013, up 1.15% in the previous 24 hours. Despite a modest recovery, Dogecoin's price is caught between its daily SMA 50 and 200 at $0.196 and $0.203, respectively, and trading below its four-hour simple moving averages.
What's coming?
Dogecoin has been trading inside a broad range between $0.14 and $0.29 for several months. The flat RSI in the negative territory indicates that the rangebound action could persist for some time. A break and close below the 50-day SMA at $0.196 might send the DOGE price tumbling to the important support level at $0.14.
The first sign of strength will be a close over the 200-day SMA at $0.208; Dogecoin may then move to $0.26 and, eventually, $0.29.
Dogecoin has recently seen a surge in accumulation by large holders, commonly known as whales. According to crypto analyst Ali, this class of holders has collectively bought more than one billion DOGE in the last 24 hours, translating to roughly $200 million at current prices.
Continued whale accumulation might be considered bullish as it signals conviction. Eyes will also be on broader market sentiment to determine Dogecoin's next price move.
Dan Burgin
U.Today Editorial Team
