The crypto market took a sharp hit recently, and Dogecoin wasn’t spared. After a dramatic drop in Bitcoin’s price, triggered by a public dispute between Donald Trump and Elon Musk, Dogecoin fell hard, losing over 10% in just a single day. Now, the coin is testing an important support level at $0.16 — and analysts say holding this level is critical for any potential rebound.
According to crypto analyst The Alchemist Trader, the $0.16 level is now the most important area for Dogecoin to hold. In a recent post on TradingView, the analyst explained that inspired cryptocurrency has been trading near several key levels over the past few weeks, but $0.16 could be a make-or-break point.
Earlier in the week, Dogecoin had managed to climb above its 200-day moving average (MA) — a technical indicator often seen as a sign of strength. This move brought renewed optimism, and many traders thought the coin was bouncing back.
Buyers began accumulating Dogecoin as the price dipped, believing it was undervalued. This created a short burst of bullish energy, and market sentiment turned positive. However, the situation quickly changed.
On Thursday, the market was hit with a shock when Bitcoin’s price suddenly dropped, and this dragged the rest of the crypto market down with it. In less than 24 hours, Dogecoin lost another 10%, breaking through the $0.18 support and sliding closer to the next key level at $0.16.
Although the $0.17 level tried to act as a temporary support, it wasn’t strong enough. With the current selling pressure, analysts believe $0.16 is now Dogecoin’s last major line of defense.
The Alchemist Trader warns that if Dogecoin fails to stay above $0.16, the chances of a bigger drop increase significantly. Falling below this support could lead to a deeper crash, making recovery much more difficult in the short term.
However, if the bulls manage to protect this level, it could help build a solid base for the next rally. The analyst notes that higher lows have already been forming on the chart, which is often a sign of a possible trend reversal.
If support at $0.16 holds and momentum returns, Dogecoin could potentially rise as high as $0.48 in the future. This would represent a 194% gain from its current level.
Despite the recent drop, there are still some bullish technical indicators that give hope to Dogecoin fans. One of them is the breakout above a descending trendline, which typically signals the end of a downtrend.
Another encouraging sign is Dogecoin holding above its 200-week moving average. When a cryptocurrency stays above this long-term indicator, it often suggests that strong support is in place — at least historically.
In the words of The Alchemist Trader:
“This breakout, coupled with sustained strength above the 200-week MA, may set the stage for a significant move to the upside.”
The long-term goal for bulls remains a return to the $0.48 zone, which was Dogecoin’s previous all-time high. While this target may seem far off now, analysts believe it’s still possible if market conditions improve and key support levels are maintained.
The recent Dogecoin price drop has reminded investors just how volatile the crypto market can be — especially when major figures like Trump and Musk are involved. With the price now sitting at a critical support level of $0.16, all eyes are on whether the bulls can hold the line.
If they succeed, Dogecoin could start to recover and build toward another major rally. But if the support breaks, more pain could be on the way.
For now, $0.16 is the level to watch — and what happens next will likely shape Dogecoin’s future in the coming weeks.
Dan hold a master of finance from the ISEG (France) , Dan is also a Fan of cryptocurrencies and mining. Send a tip to: 0x4C6D67705aF449f0C0102D4C7C693ad4A64926e9
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