Dogecoin Faces Potential Price Decline, $0.12 Key Support Level
The Essentials in Brief
Dogecoin (DOGE), the popular cryptocurrency, is facing a crucial phase. Technical analyses and on-chain metrics suggest that the price of DOGE could come under pressure. A significant point in this discussion is the value of $0.12, which is seen as critical support for the currency. The current market movements and indicators such as the Exponential Moving Average (EMA) and the Elder Force Index (EFI) provide important insights into the possible price development.
Technical Analysis: A Look at the Numbers
The analysis of the EMA values shows a so-called “Death Cross” constellation, which indicates a possible price decline of DOGE. On April 24, the 50-EMA crossed the 20-EMA, which is traditionally interpreted as a bearish signal. This trend suggests that DOGE may be facing a steep correction. In addition, the EFI, which measures buying and selling activities, shows a significant decrease in trading activity, indicating a waning interest from traders.
The Role of the Fibonacci Indicator
The Fibonacci indicator, specifically the 1.618 Fib level, also known as the golden ratio, is at $0.12. This underscores the importance of this price level as potential support for DOGE. If the bulls can defend this area, there is a chance of a recovery towards $0.16. Failure, however, could result in a decline to $0.10.
On-Chain Data and Market Performance
Despite the potential price pressure, on-chain data shows that 76.66% of the total DOGE supply is currently profitable. This is partly due to the impressive 90-day performance of the coin, which recorded a price increase of 83.65%. However, this high proportion of profitable coins could also pose a risk, as market participants may take profits, which would further increase price pressure.
The Importance of the Mean Coin Age (MCA)
The Mean Coin Age (MCA), an indicator that measures the average age of all tokens on the blockchain, has recently increased. A high MCA value indicates that many old coins have been moved, which is often associated with selling pressure and possible liquidation of assets.
Our Assessment
The current situation of Dogecoin is undoubtedly marked by uncertainty. The technical indicators and on-chain data suggest that DOGE faces challenges, especially when it comes to defending the critical support mark of $0.12. Investors and traders should closely monitor developments and be prepared to adjust their strategies accordingly. As always, it is important to make a well-thought-out decision that takes into account both technical analyses and market sentiment.
Sources
– Victor Olanrewaju, AMBCrypto
– Santiment
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