Disclaimer: The findings of the following article are the sole opinions of the writer and should not be taken as investment advice
Dogecoin‘s market has kept its investors hooked, despite high volatility. The digital asset, despite its depreciation, remained among the top alts on CoinMarketCap with a market capitalization of $30.63 billion at press time. In fact, the crypto-asset had a higher market cap than Polkadot, Uniswap, Litecoin, and Bitcoin Cash.
However, keeping up with the theme of the current market, its value has indeed been slipping lower. DOGE has lost 67% of its value since its peak in May and was trading at $0.2354, at the time of writing.
Dogecoin daily chart
Source: DOGEUSD on TradingView
The daily chart for Dogecoin highlighted the descent of the price since the month of May. DOGE’s falling price was enclosed within a descending channel. DOGE tested the support level at $0.2270 and breached it once. With the asset once again at an inflection point, it could test this level once again.
Reasoning
Dogecoin’s market continued to maintain high volatility, something that may have pushed DOGE’s value lower on the charts. As the asset continued to trade close to its support level, the market was noting selling pressure rise as well. This rise in pressure could push DOGE towards a 25% dump to $0.16623.
The Directional Movement Index underlined the prominence of southbound pressure in the market. The -DI was over the +DI, a sign of downward pressure. However, the gap between the two lines had fallen. This suggested that even though the downward pressure was dominant, it had significantly reduced too.
Meanwhile, the Stochastic RSI pictured DOGE nosediving from the overbought zone as it moved past the point of equilibrium. As the asset began consolidating at $0.2270, the selling pressure was triggered. DOGE may drop to the oversold zone if the price loses its support level.
Conclusion
DOGE’s price, at press time, was holding on to the support level at $0.2270. The asset breached this support once and seemed to be testing it once again. The market was dominated by the market’s sellers, but if the asset holds on to the support level, we may see extended consolidation.