DOGE tests a critical support after breaking a 763-day trend line

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Dogecoin Technical Analysis

Dogecoin (DOGE) is testing a critical support around $0.13 after breaking a 763-day diagonal support trendline in November.

The memecoin is currently trading at $0.131, down 58% year-over-year and 20% in the last month.

Technical analysts identify early signs of stabilization despite the prolonged bearish trend. Short-term selling pressure appears to be easing as buyers defend key price levels.

What has happened

DOGE was sold aggressively from $0.136 in early December before testing support multiple times. The price briefly dipped below $0.124 to sweep liquidity before recovering.

The token has started to form higher lows around $0.126, suggesting buyers are entering earlier than before. Crypto analyst Crypto Tony identified the $0.128-$0.130 zone as a critical inflection area. This region previously halted price action, so reclaiming it is essential for the bulls.

An RSI divergence has formed on the 4-hour chart, with the indicator making higher lows while the price continued to decline from above $0.140. This disconnect often appears near turning points after a prolonged downtrend.

Selling peaks are becoming smaller and less aggressive, indicating that distribution may be fading.

Why it matters

Breaking below its 763-day support trendline in November raised concerns that the bullish cycle had ended. The weekly chart shows that neither RSI nor MACD are generating bullish divergence, making rebounds less likely.

Technical analysts warn that a close below $0.130 could trigger a 25% drop to $0.095. If buyers regain the $0.128-$0.130 zone, DOGE could attempt a recovery toward $0.135 and potentially $0.140.

A confirmed breakout above recent swing highs near $0.132 would help validate a change in momentum. If current support levels are not maintained, $0.105 and $0.095 would come into play as the next downside targets.

Daily charts show DOGE trading within a descending parallel channel, continually making new lows. The price fell below the channel’s midline, increasing the likelihood of further declines toward the support trendline at $0.105.

The overall cryptocurrency market remains under pressure, with Bitcoin trading around $97,000 after recent volatility. Dogecoin faces additional headwinds due to the sector’s momentum slowdown compared to late 2024 highs.

Trading volume remains high at $1.99 billion in 24 hours, indicating ongoing market participation despite the weak price.