Dogecoin (DOGE) Plunges to $0.20: Is This the Bottom or More Pain Ahead?

In a dramatic reversal, Dogecoin (DOGE) plunged from around $0.34 as low as $0.20, wiping out nearly 40% of its value before finding tentative stability near $0.25 at press time.

Dogecoin (CRYPTO: DOGE) had a wild week, kicking off with a sharp drop triggered by the Trump administration’s announcement of new tariffs on major trading partners like China. The news led to a sell-off in risk assets, including cryptocurrencies, as investors reacted to the potential impact of a trade war.

Dogecoin, known for its high volatility, was particularly affected by the market turbulence. But despite the recent sell-off, one crypto analyst remains bullish on DOGE in the long term.

Here's a closer look at what happened and why Dogecoin could still be poised for gains.

Dogecoin Drops on Trump Tariffs

The unexpected announcement of new tariffs by the Trump administration on Friday sent shockwaves through financial markets. Major trading partners like China, Mexico, and Canada were hit with the new levies, sparking fears of an escalating trade war.

In response, investors grew concerned and began pulling out of risky assets, including cryptocurrencies, leading to a broad sell-off. Dogecoin, being highly volatile, was sharply impacted by the market sell-off.

Dogecoin saw an immediate and significant drop on Friday evening, within hours of the news breaking. Over the weekend, the crypto market crash continued as part of a larger market reaction.

Major altcoins like XRP (CRYPTO: XRP) and Cardano (CRYPTO: ADA) also experienced double-digit percentage losses. In total, the crypto market wiped out over $2.2 billion in crypto liquidations.

Dogecoin Price Analysis

A closer look at the technical analysis chart shared by Alemzadeh shows Dogecoin’s price initially breaking above a descending red trendline in October.

That line has acted as a key resistance zone stretching back to previous local highs, and the ensuing retreat has brought the market right below the trendline again.

In parallel, Dogecoin is still positioned above its 30-week moving average (30w), which is plotted as a pink-dotted curve and currently sits around the $0.20–$0.22 range.

Analysts often regard weekly closes above this average as a sign of underlying strength, suggesting that DOGE may yet hold onto its bullish price action if the market steadies above that threshold.

The chart also highlights a series of Fibonacci retracement and extension levels, each offering insight into potential support and resistance.

At the forefront is the 0.618 Fibonacci retracement around $0.2667, a critical region that the price now hovers around. This level often draws the attention of traders looking to identify whether the market is in a standard pullback or has begun a deeper correction.