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Following the Bitcoin price sweep down below the $104,000 level over the weekend, the Dogecoin price was pushed back down below $0.2 once again. This move understandably shocked the community as the $0.2 has held for a long time. However, using the 4-hour order block (OB), a crypto analyst has explained what is going on with the Dogecoin price, why the decline happened, and where it could be headed next.
Dogecoin Price Experienced A Liquidity Sweep
Crypto analyst Smart Flows, on the TradingView website, pointed out an interesting development on the Dogecoin price chart. This showed a clear delineation for why the meme coin’s price dropped below the $0.2 psychological support level, and it came down to something as clean as a liquidity sweep.
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The crypto analyst uses the 4-Hour order block on the Dogecoin price chart to explain this, starting just above the $0.22 price level. This saw a liquidity sweep through the Fair Value Gap (FVG) at the 0.5 Fibonacci level, breaking through the $0.2 support. This move, Smart Flows explains, was in no way emotional and was more of a ‘mechanical’ move, suggesting it was engineered to happen.
The outcome of this liquidity sweep is that there has now been a reset of sentiment surrounding the Dogecoin price, setting the stage for a potential reversal. If this is the case, then Dogecoin may be sitting on the cusp of what could be the next major rally above $0.2.
What To Expect Next From Here
According to the crypto analyst, Dogecoin is now sitting in a 4-Hour demand order block zone that is in confluence with the Fair Value Gap (FVG) above $0.2. This makes the $0.20928 level the first “key reaction point,” and the analyst points out two possibilities for the meme coin here: either the price continues to stall or consolidation begins at this level.
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Basically, the Dogecoin price has to be able to beat the first major test at $0.209 before moving higher from here. This means it must complete a clean clearance of the FVG to grab liquidity above. After this, the real test begins at $0.22094, where the next major 4-Hour order block sits. The analyst explains that being able to clear the FVG will mean a continuation model is in play.
However, there is still the possibility that the Dogecoin price is rejected before it is able to clear the FVG above $0.2. In this case, it could signal a further downtrend for the altcoin. “If we reject early — that tells me distribution is starting, and I’ll prep for a secondary sweep below 0.18 to retest the deeper 4H OB near 0.16387,” the analyst concluded.
Featured image from Dall.E, chart from TradingView.com
Reason to trust
Strict editorial policy that focuses on accuracy, relevance, and impartiality
Created by industry experts and meticulously reviewed
The highest standards in reporting and publishing
Strict editorial policy that focuses on accuracy, relevance, and impartiality
Morbi pretium leo et nisl aliquam mollis. Quisque arcu lorem, ultricies quis pellentesque nec, ullamcorper eu odio.
Following the Bitcoin price sweep down below the $104,000 level over the weekend, the Dogecoin price was pushed back down below $0.2 once again. This move understandably shocked the community as the $0.2 has held for a long time. However, using the 4-hour order block (OB), a crypto analyst has explained what is going on with the Dogecoin price, why the decline happened, and where it could be headed next.
Dogecoin Price Experienced A Liquidity Sweep
Crypto analyst Smart Flows, on the TradingView website, pointed out an interesting development on the Dogecoin price chart. This showed a clear delineation for why the meme coin’s price dropped below the $0.2 psychological support level, and it came down to something as clean as a liquidity sweep.
Related Reading
The crypto analyst uses the 4-Hour order block on the Dogecoin price chart to explain this, starting just above the $0.22 price level. This saw a liquidity sweep through the Fair Value Gap (FVG) at the 0.5 Fibonacci level, breaking through the $0.2 support. This move, Smart Flows explains, was in no way emotional and was more of a ‘mechanical’ move, suggesting it was engineered to happen.
The outcome of this liquidity sweep is that there has now been a reset of sentiment surrounding the Dogecoin price, setting the stage for a potential reversal. If this is the case, then Dogecoin may be sitting on the cusp of what could be the next major rally above $0.2.
What To Expect Next From Here
According to the crypto analyst, Dogecoin is now sitting in a 4-Hour demand order block zone that is in confluence with the Fair Value Gap (FVG) above $0.2. This makes the $0.20928 level the first “key reaction point,” and the analyst points out two possibilities for the meme coin here: either the price continues to stall or consolidation begins at this level.
Related Reading
Basically, the Dogecoin price has to be able to beat the first major test at $0.209 before moving higher from here. This means it must complete a clean clearance of the FVG to grab liquidity above. After this, the real test begins at $0.22094, where the next major 4-Hour order block sits. The analyst explains that being able to clear the FVG will mean a continuation model is in play.
However, there is still the possibility that the Dogecoin price is rejected before it is able to clear the FVG above $0.2. In this case, it could signal a further downtrend for the altcoin. “If we reject early — that tells me distribution is starting, and I’ll prep for a secondary sweep below 0.18 to retest the deeper 4H OB near 0.16387,” the analyst concluded.
Featured image from Dall.E, chart from TradingView.com
