Dogecoin (DOGE) Risks Further Downside if It Settles Below $0.15

Dogecoin remains stuck near multi-month lows near the $0.15 level while crypto markets stay mostly flat after the recent sell-off.

Rising Rate Environment Strengthened Dogecoin’s Downside Trend

As we have recently discussed, meme coins are losing market share to other crypto projects amid broad crypto market sell-off.

Dogecoin, which was the first meme coin to gain worldwide fame, has been a poor performer for many months. After reaching all-time highs near $0.74 at the beginning of May 2021, Dogecoin found itself under pressure and ultimately reached the $0.15 level.

Global financial markets are worried about high inflation and Fed’s potential moves which may include higher rates and even a reduction of Fed’s balance sheet.

In this environment, assets like meme coins look especially vulnerable, as they very speculative.

In case the broad crypto sell-off continues and the world’s leading cryptocurrency, Bitcoin, settles below the psychologically important $40,000 level, Dogecoin will likely find itself under significant pressure as traders would continue to dump riskier assets.

A Move Below $0.15 Would Push Dogecoin Towards December Lows

The technical picture for Dogecoin remains bearish. Dogecoin managed to settle below the support level at $0.1550 and is trying to settle below the next support level at $0.1500. RSI is close to the oversold territory, but there is enough room to gain additional downside momentum in case the right catalysts emege.

If Dogecoin declines below $0.1500, it will get to the test of the next support at the recent lows near $0.1450. A move below this level will push Dogecoin towards the next support at $0.1320. It should be noted that there are few support levels between $0.10 and $0.15 as Dogecoin’s upside move in April 2021 was very fast, so a move below $0.15 may ultimately lead to a serious sell-off.

On the upside, Dogecoin needs to stay above $0.15 to have a chance to gain upside momentum in the near term. The previous support at $0.1550 will serve as the next resistance level for Dogecoin. In case Dogecoin gets back above this level, it will head towards the resistance at $0.16.

Taking a look at H1 chart, we can see that RSI is in the moderate territory while Dogecoin is consolidating near $0.15, and it looks that Dogecoin is ready to develop additional downside momentum in case it manages to settle below $0.15.