Dogecoin price approaches support level of $0.0813 after decline of 17%

Dogecoin is currently trading around $0.08 after a decline of more than 17% from the peak of $0.1007 on 22 August. Analyst Ali Martinez sees several signals pointing to a possible bottom: a technical buy signal on the daily chart, a bullish pattern and significant purchases by whales. Whether this is genuinely a turning point remains to be seen.

Dogecoin is available at Bitvavo and OKX.

In brief:

• Dogecoin fell by more than 17% from $0.1007 to approximately $0.0828 and is now around $0.08
• Technical indicators and a morning doji star pattern suggest the correction may be coming to an end
• Whales bought more than 400 million DOGE over the past five days

Technical signals point to possible bottom

According to Martinez, the Tom DeMark Sequential indicator issued a buy signal on the daily chart. This system counts consecutive candles and, after a certain number, issues a signal that a trend reversal may be near. The signal appeared after day nine of the decline, followed by a first recovery candle.

In addition, the daily chart shows a so-called morning doji star, a pattern consisting of three candles that typically occurs at the end of a downtrend. The pattern suggests that selling pressure is easing and buyers are starting to step in, although this is no guarantee of a trend reversal.

Whales buy more, on-chain support around $0.0813

Data from Santiment shows that large holders have bought more than 400 million Dogecoin over the past five days. The total amount of Dogecoin held by whales rose from approximately 18.2 billion to more than 18.7 billion.

Based on Glassnode data, Martinez sees a solid on-chain support level around $0.0813. Nearly 35 billion Dogecoin were previously traded at that level, which in his view makes this price point significant. As long as the price remains above this level, he considers the technical setup positive.

Martinez names $0.1552 and $0.1774 as the next price targets, levels where large amounts of Dogecoin also changed hands previously. Whether the price actually reaches those levels will depend in part on broader market conditions.