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Dogecoin has once again dipped into oversold territory on its 4-hour chart on Tuesday, marking the most pronounced level of selling pressure since the sudden capitulation on February 3. During that episode, the price plunged to around $0.20 before rebounding by 45% within the same trading day—a move that underscored how quickly Dogecoin can rally from oversold conditions.
Dogecoin Price Plunges Into Oversold Zone
In an analysis today, crypto Analyst Cas Abbé (@cas_abbe) highlights an RSI reading that has dipped to 30 on Tuesday, indicating that selling pressure may be nearing its limit. Dogecoin’s path to this oversold level began after it failed to maintain momentum near $0.28.
The cryptocurrency currently trades around $0.25, a zone that Abbé identifies as historically prone to strong support. He suggests that negative sentiment toward memecoins triggered by the LIBRA meme coin disaster by Argentinian President Javier Milei appears to have reached unprecedented lows. This, according to him, could paradoxically create an attractive accumulation opportunity.
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Abbé projects that Dogecoin could stage a short-term push to $0.30, a psychologically significant level that coincides with prior resistance. A move beyond $0.30 could open the door for a test of the yearly high, although a sustained uptrend may hinge on how broader market sentiment evolves and whether broader risk-appetite improves.
“DOGE has reached its most oversold level since the February 3rd capitulation. Sentiment for memes has reached an all-time low, which also presents a good opportunity to accumulate cult memecoins. I’m expecting a short-term move towards $0.3, followed by a new yearly high,” Abbé concludes.
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On Monday, Abbé also discussed a recurring bullish pattern visible on the 3-day chart of Dogecoin. He traced three distinct descending channels in Dogecoin’s price action—one in Q4 2023, another in Q3 2024, and the current one unfolding in early 2025.
In both of the previous instances, Dogecoin broke above the descending channel’s upper boundary, sparking gains exceeding 150%. Abbé points out that Dogecoin appears to be following a similar downward-sloping channel today, ranging from approximately $0.36 at its upper boundary to around $0.24 at its lower end.
If the same pattern holds true, a decisive break above the channel’s resistance could trigger another triple-digit percentage rally. However, if Dogecoin moves below that lower boundary, the bullish setup observed in the prior two breakouts would face potential invalidation.
At press time, DOGE traded at $0.25.
Featured image created with DALL.E, chart from TradingView.com
