18% Drop Since May 10th Creates Critical Support Test

TLDR

• DOGE has dropped over 18% since May 10th local high, now trading around $0.23
• Price is consolidating between the 200-day EMA ($0.219) and 200-day SMA ($0.269)
• Analyst Ali Martinez suggests a possible retest of the $0.213 support level
• On-chain metrics show positive funding rates, indicating bullish sentiment
• Technical outlook points to potential 20% gains if support holds

Dogecoin has entered a critical consolidation phase after experiencing a sharp rejection below the $0.26 resistance level last week. The popular meme coin has retraced some of its gains after an impressive rally that began in early April, dropping over 18% since reaching a local high on May 10th.

The price action follows a strong breakout above $0.13 in April, which had resulted in a 100% surge within a month. However, recent market movements suggest this upward momentum may be stalling.

Currently trading around $0.23, DOGE sits above its 200-day Exponential Moving Average (EMA) at $0.219, but remains below the 200-day Simple Moving Average (SMA) at $0.269. This zone has become a key battleground between bulls and bears.

According to analyst Ali Martinez, the recent rejection has opened the possibility for DOGE to revisit the $0.213 level – a critical zone that previously served as both resistance and support during the April breakout.

#Dogecoin $DOGE may want to revisit $0.213! pic.twitter.com/ruKqcXEqNP

— Ali (@ali_charts) May 20, 2025

Technical Picture Shows Mixed Signals

The daily chart for Dogecoin reveals a loss of momentum following the early May price action. Trading volume has notably declined since the breakout, suggesting waning trader interest in the current range.

The tight-bodied candle structures on recent days indicate market indecision. If DOGE loses the $0.219-$0.220 support zone, the next logical support level sits at $0.213, aligning with analyst concerns of a potential retest.

A breakdown below this area could trigger further downside pressure toward the $0.19 zone. Conversely, reclaiming the 200-day SMA at $0.269 would be a major bullish signal, as it would place DOGE back above long-term resistance.

The Relative Strength Index (RSI) on the daily chart reads 61, remaining above its neutral level of 50. This technical indicator suggests bullish momentum despite the recent price retracement.

On-Chain Metrics Show Positive Signs

On-chain data presents a more optimistic outlook for the meme coin. According to Coinglass’s OI-Weighted Funding Rate data, DOGE currently stands at 0.0094%, reflecting a positive rate where longs are paying shorts.

This metric is based on the yields of futures contracts weighted by their Open Interest rates. The positive reading typically indicates bullish sentiment in the market, suggesting potential upward pressure on DOGE prices.

Additionally, Santiment’s Age Consumed index projects a bullish outlook. Recent spikes in this index suggest dormant tokens (those stored in wallets for extended periods) are now in motion. Historically, such spikes have preceded price increases for Dogecoin.

The most recent uptick on Tuesday forecasts that DOGE may be ready for an uptrend. If the 200-day EMA continues to hold as support, Dogecoin could potentially extend its rally by 20% from current levels to retest the 50% price retracement level at $0.27.

Dogecoin has retested and found support around its 200-day EMA at $0.21 multiple times since last week. This level appears to be providing a solid foundation for potential recovery.

However, if DOGE breaks and closes below the 200-day EMA at $0.21, it would likely extend the correction to retest its next weekly support at $0.18.

The coming days will be decisive as Dogecoin navigates this high-stakes moment. The meme coin narrative could regain strength if bulls reclaim control and push DOGE back toward the $0.26 resistance. For now, all eyes remain on this pivotal support zone as Dogecoin trades within the broader market’s uncertain conditions.

DOGE currently trades at $0.23, above its critical 200-day EMA support level.