Dogecoin Price Retests the Zone That Triggered 900% DOGE Rally

Dogecoin (DOGE), the leading memecoin by market cap, is testing a long-term support zone that previously preceded one of its strongest rallies, raising hopes that its prolonged price decline may be approaching exhaustion.

DOGE Returns to Historic Accumulation Zone

As of Tuesday, Aug. 4, DOGE was trading near $0.07, down roughly 85% from its late-2024 peak around $0.48. The memecoin also remained below its major weekly exponential moving averages, confirming that sellers still control the broader trend.

However, Dogecoin is now approaching the $0.048–$0.063 range, as shown via the red zone below. This area is down about 30% from the current price levels, and it served as a major accumulation zone between 2022 and early 2024.

DOGE rebounded approximately 224% after testing the zone in June 2022. Its later return to the same support area preceded an even larger 887% rally toward $0.48.

The potential retest, which may come by the US mid-term election in November, raises the possibility of another macro rebound, particularly as Dogecoin’s weekly relative strength index (RSI) may also decline below the oversold threshold of 30 by then.

As of Tuesday, the RSI was around 32.7.

An initial recovery could push DOGE toward its 20-week EMA (green) near $0.088. A decisive break above that level may open the door toward the $0.11–$0.12 resistance range.

Nevertheless, a weekly close below $0.05 would invalidate the accumulation thesis and expose DOGE to deeper losses.

Macro Risks To Consider: BoJ and Fed Rate Hike, Yen Carry Trade

Dogecoin’s fractal setup could still fail if global liquidity conditions tighten further.

The Bank of Japan held its policy rate at 1% in July after raising it by 25 basis points in June. However, the decision passed by an 8-1 vote, with board member Hajime Takata supporting an immediate increase to 1.25%.

Japan’s two-year government bond yield subsequently rose to 1.51%, while markets assigned roughly a 40% probability to a September hike, up from 20% a week earlier.

The Federal Reserve presents another liquidity risk. CME FedWatch data showed the probability of a 25-basis-point September hike rising to approximately 62.5%, versus 55.8% one week earlier.

Simultaneous tightening could strengthen the yen and accelerate the unwinding of yen-funded carry trades. During the August 2024 unwind, Japan’s Nikkei dropped nearly 20%, the S&P 500 lost more than 5%, and Bitcoin declined around 15%.

The affected leveraged trades were estimated at roughly ¥40 trillion, or $250 billion.

A similar deleveraging event would likely pressure DOGE despite its historical support setup.