Dogecoin faced a significant decline, breaking below crucial technical support as risk aversion driven by macroeconomic factors spread across the cryptocurrency market, following the Federal Reserve’s rate decision.
News Background
The cryptocurrency market adopted a defensive stance after the Federal Reserve announced a 25-basis-point interest rate cut, reducing its target range to 3.5%–3.75%. Although the cut was anticipated, internal disputes among policymakers and resurfacing inflation concerns unsettled risk assets, leading to widespread selloffs in digital currencies.
Meme coins, known for their increased volatility during macroeconomic disturbances, lagged behind as Bitcoin dipped below $90,000 over the weekend. Dogecoin experienced intensified downward pressure as traders minimized their exposure amidst increased volatility, despite the absence of any specific negative news related to DOGE.
Technical Analysis
From a technical perspective, DOGE underwent a typical capitulation event.
The vital support level at $0.1407 was decisively tested at 15:00 UTC on December 12. Selling pressure escalated rapidly, accompanied by a staggering 348% increase in volume, indicating forced liquidation rather than mere profit-taking. Such significant volume expansion at the point of support failure usually signals short-term exhaustion.
After the breakdown, DOGE reached a session low of $0.1372, where selling pressure started to diminish. Subsequent candles reflected progressively lower volume, indicating that sellers were losing control. The ensuing structure—a swift recovery with higher lows—culminated in a V-shaped reversal, a pattern often seen when large participants react during panic situations.
Despite ongoing damage to the broader trend, immediate downside momentum seems to be exhausted unless the $0.1372 level fails.
Price Action Summary
DOGE decreased by 2.6% throughout the session, dropping from $0.1413 to $0.1376 and trading within a range of $0.0064, reflecting 4.6% intraday volatility.
The most significant selling occurred during the breakdown phase, as volume surged to 1.11 billion tokens, surpassing bids and rapidly pushing the price downward. Following the establishment of the $0.1372 low, DOGE steadied and made a modest recovery towards the closing, finishing near $0.1376.
Late-session volatility momentarily dropped the price back to $0.1372 during the 01:37–01:53 window, yet buyers defended that level once more, reinforcing its status as near-term support.
What Traders Should Know
Dogecoin is currently positioned at a technical crossroads.
• The $0.1372 low serves as the most critical short-term support
• Holding above this level consistently favors consolidation over continuation
• Reclaiming $0.1407 would indicate short-term trend restoration towards $0.1425–$0.1440
• Failing below $0.1372 opens doors to downside toward $0.1354 liquidity support
• The volume profile suggests that capitulation selling may be concluded
In conclusion, DOGE has transitioned from an active selloff to a stabilization phase. The forthcoming movement will hinge on whether buyers can maintain the $0.137 area and recover previous support, or if overarching macro pressure induces another downward leg.
