Dogecoin reversal after a bearish weekend suggests a potential bounce back to $0.19, with a post-retest recovery from a falling channel pattern.

As the crypto market gradually gains bullish momentum this week, Dogecoin has risen by nearly 3% in the past 24 hours. Currently trading at $0.1705, Dogecoin holds a market cap of $25.35 billion.

However, the overall meme coin market has dropped to $48.95 billion, recording a nearly 15% decline over the past 30 days. As meme coins remain highly volatile, will the short-term recovery lead to a bounce above $0.20 in DOGE prices?

Dogecoin Price Analysis Hints Post-Retest Bounce Back

On the daily chart, Dogecoin’s price action shows a bullish breakout from a falling channel pattern. However, the recovery failed to overcome the bearish pressure at the 23.60% Fibonacci level at $0.1945.

After approaching $0.20, a tweezer top reversal triggered a four-day correction for Dogecoin. With consecutive bearish candles, Dogecoin dropped by nearly 15%.

However, this pullback may represent a potential retest of the broken falling channel pattern. Dogecoin formed a Doji candle after a lower price rejection at $0.16 on Monday.

The resurgence of bullish momentum has sparked a 2.23% intraday recovery, hinting at a potential morning star pattern formation.

Despite this, the 100- and 200-day EMA lines are approaching a negative crossover, signaling bearish pressure. Additionally, the recent short-term pullback has significantly weakened bullish momentum.

The MACD and signal lines also warn of a negative crossover as the bullish histograms decline. As a result, technical indicators still lean bearish due to the prevailing downtrend.

Elon Musk Behind the $0.16 Retest

Notably, Dogecoin’s short-term recovery reflects a swift turnaround following a recent hit from Elon Musk. The American billionaire and chairperson of the Department of Government Efficiency recently stated during a town hall meeting:

“As far as I know, there are no plans for the government to use Dogecoin or anything similar.” 

This statement triggered the recent drop to $0.16. However, Dogecoin has since bounced back and is hinting at a potential recovery this week.

Key Price Levels For Dogecoin 

Based on the price analysis, the post-retest reversal from the falling channel pattern is likely to challenge the 23.60% Fibonacci level at $0.1945 again. This suggests an upside potential of nearly 15%.

If the recovery extends, the uptrend could reach the 38.20% Fibonacci level at $0.22, offering a 32% bullish potential. On the other hand, a decline below the broken resistance trendline would put pressure on the $0.15 psychological support level.