The continuation of the bearish momentum is evident in Dogecoin’s recent significant drop, which has taken it below the critical psychological level of $0.10. The asset’s short-term recovery prospects are becoming increasingly questionable due to the extremely low trading volumes that accompanied the price drop.
Taking into account the attached chart, it is evident that Dogecoin price is declining and that a possible bearish crossover between the 200-day and 50-day EMA is approaching.
For DOGE holders, the worst may yet come as this cross, also known as the death cross, often heralds an even more severe correction. Since there has traditionally been a high degree of psychological support for the asset, it is worrying that DOGE has failed to hold support at $0.10. Perhaps the most worrying indicator at this stage is the lack of volume.
Declining volume often signals sellers are exhausted and a reversal is possible. However, in Dogecoin’s case, the lack of buyer support indicates that traders and investors may not be very motivated to push the price higher. The price is likely to continue to fall or remain stagnant in the lower price range in the absence of large inflows. Moreover, DOGE is also not receiving any help from the broader market environment.
Because Dogecoin is a highly speculative asset, it is unlikely to outperform the broader market unless there is a surge in hype or an external stimulus, such as celebrity endorsements.
To sum it up, Dogecoin technical indicators point to more downward pressure to come. The ongoing death cross between the 50 and 200 EMA signals a prolonged bearish phase. The break of the $0.10 barrier was crucial to maintain bullish sentiment.
