 ▲ Dogecoin (DOGE) |
Dogecoin (DOGE), swept up in Bitcoin’s sharp downturn, is struggling to break its downtrend as it attempts a dramatic reversal near the $0.095 level, the lower support line of the Bollinger Bands.
According to cryptocurrency outlet The Crypto Basic on February 6 (local time), Dogecoin has withstood intense selling pressure and is attempting to stabilize around $0.095, the lower Bollinger Band support zone. Analyst Mark Brennan noted that as Dogecoin has reached the extreme end of the oversold range, a technical rebound appears imminent, with bargain-hunting demand gradually flowing in. He assessed the current price range as a critical inflection point that could form a short-term bottom and prepare for a new trend reversal.
Technical indicators are lending support to the possibility of a recovery. The Relative Strength Index (RSI) is slowly turning up from the oversold area around 30, while the downside momentum of the Moving Average Convergence Divergence (MACD) appears to have reached a critical threshold. Since price mean reversion after touching the lower Bollinger Band is typically accompanied by strong reactive buying, holding the $0.095 support level is expected to be the key factor determining the strength of any forthcoming rebound.
For Dogecoin to kick off a full-fledged recovery rally, it must decisively break above the initial resistance at $0.135. Brennan believes reclaiming $0.135 would be a decisive catalyst to shift Dogecoin’s short-term trend from bearish to neutral. If the price pushes through resistance and gains momentum toward the upper zone where the 200-day moving average is located, the next upside targets could be sequentially raised to $0.18 and $0.22.
However, if Bitcoin (BTC) fails to defend the $60,000 level and continues to decline, Dogecoin also faces the risk of retreating toward $0.08. Uncertainty surrounding regulatory policies under U.S. President Donald Trump’s administration, along with geopolitical risks stemming from the Middle East, has drained overall market liquidity, limiting the scope of any rebound. In addition, a sharp drop in open interest in the futures market indicates an ongoing deleveraging process that is also contributing to heightened price volatility.
As the flagship of the memecoin sector, Dogecoin currently serves as a barometer of market risk appetite. If the technical bottoming process proceeds smoothly, this reversal at the lower Bollinger Band could offer a favorable entry point for long-term investors. Rather than focusing on short-term price recovery, the market is closely watching whether Dogecoin can successfully establish a stable base around $0.095 accompanied by rising trading volume.
*Disclaimer: This article is for investment reference only, and no responsibility is taken for any investment losses based on it. The content should be interpreted solely for informational purposes.*