With heightened bearish pressure continuing to impact Dogecoin’s price action, investors are now discussing and showing concerns about when the meme coin could bottom out. However, a crucial signal has recently emerged from a key metric, suggesting that DOGE’s market bottom may be taking shape.
Dogecoin’s Price Bottoming Signal Emerges
Dogecoin may witness a slight bounce on Sunday, but its broader outlook remains highly bearish, stifled by ongoing volatility in the crypto market. As investors look for indications that Dogecoin might be nearing a turning point, one on-chain metric is gaining attention for its clues about the meme coin’s current phase.
These clues are emerging from the Dogecoin Cumulative Value Days Destroyed (CVDD) metric. After thoroughly examining the metric, Joao Wedson, the founder of the Alphractal on-chain platform, announced that DOGE is in a price bottoming phase. According to the expert, this metric has been one of the most accurate throughout the meme coin’s history. This is because every time DOGE approached 1 on the chart, or spent just a few days below it, major price bottoms often follow.
While the phase matures, Wedson highlighted that the latest bottoming signal will be triggered whenever Dogecoin falls below the $0.08 level. Once the meme coin drops below this level, this development will be seen as an ideal entry point, as the smartest investors are expected to start accumulating a lot of DOGE.
As a result, the expert has advised investors to start accumulating, especially during the capitulation phase, and hold the meme coin for a long time. In the midst of rising volatility, Dogecoin could reach a price bottom before Bitcoin.
Wedson is confident DOGE might bottom out in June because the meme coin often marks a local bottom in the month in bear market periods. Meanwhile, BTC typically reaches a price bottom at the end of Q3 or Q4 during bear market phases.
Past Price Trend Is Set To Repeat
DOGE may bottom out in June, but its price action in the month is not going to be a smooth one. In the monthly timeframe, Dogecoin has dropped down to a long-term macro support level, which has been present since 2017.
As a result, Namtoshi Dogemoto, an investor and crypto analyst, has predicted that the meme coin may experience some volatility in June as it did in the 2020 market cycle. During the period, DOGE dropped below this support on multiple occasions and sprinted back up before the end of the month. With a similar trend emerging, DOGE is likely to mirror the price action of June 2020.
Currently, the expert is positioned below the macro support level, and a repetition of this price action could result in massive gains. “I didn’t think we would visit down here, but it’s a great opportunity to load up now,” Dogemoto added.
Ali Charts shared that DOGE has reached a closely monitored target of $0.0883, with the lower boundary of a parallel channel now being tested. As long as this support holds, the expert believes recovery toward $0.1019 and $0.1156 could unfold. However, a breakdown is likely to expose the next major supply zone near $0.067.
Featured image from Pngtree, chart from Tradingview.com
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