Dogecoin (DOGE) pared some losses against Bitcoin (BTC) on March 10, one day after the DOGE/BTC pair plunged to its lowest level since October 2022. Can DOGE price see a rebound extended by in front of?
On the daily chart, the DOGE/BTC pair reached 331 satoshis, 4.75% higher than the previous day’s low of 316 satoshis. The bounce occurred around a multi-month downtrend line, which has limited the pair’s downside moves since November 2022.
The price of DOGE against BTC
Interestingly, the DOGE/BTC pair’s falling trend line appears to be part of a prevailing falling wedge pattern. Traditional chart analysts view the falling wedge as a bullish reversal setup, particularly given the pattern’s 62% success rate in meeting its upside price objectives.
In the case of Dogecoin, the price is reeling around the apex of its falling wedge, where its upper and lower trend lines converge. DOGE’s latest bounce from the lower trend line increases its chance of touching the upper trend line for a breakout to the upside, as shown in the chart below.
The bullish setup is further supported by the daily RSI for the DOGE/BTC pair with a reading around 28. From a technical perspective, an RSI below 30 means that the pair is oversold, which could lead its price to consolidate laterally or rebound.
In the event of a breakout, DOGE/BTC may rally towards 500 satoshis in April, 50% from current price levels. The bullish target is measured after adding the maximum distance between the upper and lower trend line of the falling wedge and the breakout point.
However, a decisive drop below the lower trend line of the falling wedge could invalidate the entire bullish setup. Instead, DOGE may fall towards 280 satoshis, a historical support level on the downside, around 13% from current price levels.
Such a scenario is possible given Dogecoin’s stay with a failed falling wedge pattern in March 2022, in which the DOGE/USD pair broke below the lower trend line: then came 50% losses.
What is the path for DOGE price?
However, Dogecoin could still fall in US dollar terms, largely due to growing macroeconomic uncertainty.
In recent years, Dogecoin’s price has risen mostly thanks to news and support from Elon Musk, including hopes for a DOGE option as a payment method on Twitter.
However, Musk said on March 3 that he would shift his focus from cryptocurrencies to artificial intelligence. The billionaire businessman did not name Dogecoin specifically, but many interpreted that Musk might distance himself from the industry in the future.
“I used to be in crypto, but now I got interested in AI”
— Elon Musk (@elonmusk) March 3, 2023
Dogecoin price has fallen more than 20% to $0.06 since Musk’s tweet. Also, from a technical perspective, the price is well positioned to fall another 10% in the coming weeks on a retest of an old support level around $0.055-0.042.
Conversely, a bounce from the support range could see DOGE price test the upper trend line of the triangle around $0.076, resulting in gains of roughly 15% from current price levels.
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