Dogecoin (DOGE), the popular meme-inspired cryptocurrency, has recently experienced significant downside volatility. However, according to a technical analysis by Rekt Capital, a well-known crypto analyst, this volatility has actually confirmed DOGE’s new macro uptrend.
The primary goal for Dogecoin was to retest the $0.20 level as new support following a positive monthly close above that level in March.
While there was scope for downside volatility as part of the retrace, DOGE actually retraced deeper than expected, dropping closer to the $0.12 range low.
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This move briefly gave the impression that DOGE was breaking back down into the $0.12–$0.20 range, despite having previously broken out of it.
Dogecoin Retesting the Macro Downtrend as New Support
Interestingly, this downside volatility brought DOGE very close to retesting the macro downtrend it had broken out of last month. In doing so, Dogecoin effectively turned an old multi-year resistance into a new multi-year support. By successfully retesting this area, DOGE has fully confirmed its new macro uptrend.
Rekt Capital points out that technically, DOGE could still recover in time for the April monthly close to occur above the $0.20 level. However, if this doesn’t happen, Dogecoin will likely continue to trade within the $0.12–$0.20 range until it is ready to break out again.
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The analyst emphasizes that the confluent support of the range low at $0.12 and the macro downtrend is the absolute crucial support for maintaining DOGE’s new macro uptrend. Thus far, Dogecoin has successfully retested this area, which is a positive sign for its future price action.
With plenty of time left in the current monthly candle, there is still a chance that DOGE will manage to reclaim the $0.20 level as support before the month concludes.
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