CryptocurrencyCryptocurrency ExchangesPrice Analysis

Dogecoin Shows Sign of Recovery in a Likely End of Its Downtrend

Started as a Joke, Now a Giant

The popularity of Dogecoin as a serious cryptocurrency started in 2021, and it has been able to return over 3000% value to investors between that time and now. The “meme coin,” as it is popularly known, was created by Jackson Palmer and Billy Marcus in 2013. It was started as a joke, but it has been able to raise a lot of money for the benefit of society.

Dogecoin runs on a decentralized blockchain tech like its predecessors, Ethereum and Bitcoin. It is a digital ledger with high security that has the capacity to store all deals carried out on it utilizing a decentralized system. Cryptography is what the system uses to make sure all transactions are secure. Although the Dogecoin network is used in payment settlement, it is not considered as a substantial store of value as Bitcoin is. Dogecoin does not have a complex capitalization, and that makes it highly susceptible to inflation by its design.

Tesla’s billionaire founder, Elon Musk, called Dogecoin the “people’s crypto” via his Twitter account, and that nudged the token higher and increased the demand for it in the crypto market. Recently, Musk announced that Tesla would be accepting Dogecoin in the purchase of some of its merchandise like Cyberquad and Cyberwhistle for children. That gave Dogecoin a fascinating behavior in the market.

DOGE/USD Chart 1. Source TradingView

In the course of putting this piece together, Dogecoin was selling around $0.123. In the end, the chart appears to be bearish, having occasional marginal high points, which is not a very encouraging sight for investment for the time being.

A Minor Setback

The moving average convergence divergence indicator is at a bearish level also, and the Relative Strength Index is at the oversold area around 30. The candles are forming together in the lower part of the Bollinger Bands. Candles broke to the lower half as a result of events in Between Russia and Ukraine on Thursday.

DOGE/USD Chart 2. Source TradingView

By doing an analysis of the daily chart, one may think that $0.13 is the support level and that $0.16 is a strong level of resistance. It means, therefore, that candles have broken through the first support level. It has now become difficult to say when the corrective measure will come to a close.   

As a meme coin, it is more influenced by news and events on social media. Nobody can really give a prediction of its exact trajectory because it lacks strong fundamentals. Active social media users can invest in it in the short term so that any positive news about the token can influence the price and bring in a good return.  

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