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Buying or Shorting Dogecoin and VeChain? Technical support & resistance

February 24, 2022 17:38
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Today, Short Selling will discuss the latest technical analysis levels connected with Dogecoin (DOGE) and VeChain (VET) and where the price of these two cryptocurrencies could move in the upcoming period.

Risk aversion continues to dominate financial markets as the uncertainty of potential outcomes between Ukraine and Russia continues to worry investors. The price of most public cryptocurrencies remains under pressure, and some analysts are predicting that the upcoming days will likely be tough for the cryptocurrency market. Ukraine declared a state of emergency, while reports of cyberattacks on several of its state websites fueled fears about escalating tensions with Russia.

Following the Russian invasion, the cryptocurrency market fell even more and worry about if the situation could worsens. Many investors look for safer places to invest their money. Andre Bakhos, managing director at New Vines Capital LLC in Bernardsville, New Jersey, said:

“A high level of uncertainty creates fear, and fear manifests into defensive behavior. And the defensive behavior translates into some asset and sector rotation from a risky profile to less risky profiles. So, I believe that the downside is to be favored right now”.

Sanctions against Russia

Europe and the United Kingdom imposed sanctions against Russia that include asset freezes and travel bans for certain Russian elites, while the U.S. president Joe Biden said that the “first tranche” of U.S. sanctions against Russia include two Russian banks and the country's sovereign debt.

Speculation about the Federal Reserve's next move also weighed on the cryptocurrency market after Fed Bank President John Williams said that it would be appropriate to hike interest rates in March. The U.S. central bank is likely to meet market expectations for a 25-basis-point rate hike on its meeting next month, while Fed Chairman Jerome Powell said that there is more room for further policy tightening without hurting employment.

Could monetary tightening lead to lower price for risky assets?

Monetary tightening is usually seen as a drag on risky assets, and according to Morgan Stanley, the cryptocurrency market could lose its value even more if the U.S. central bank set out a more aggressive tone to fight inflation after the March rate hike.

After hitting recent highs above $0.20, Dogecoin (DOGE) has encountered losses of more than 30% in less than several weeks. The price has stabilized now above $0.13, but a break below the $0.12 level would indicate that Dogecoin (DOGE) could probably test the $0.10 support.

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VeChain (VET) also remains under pressure, its price has weakened from recent highs above $0.06, and for now, the risk of further decline still persists. The price of these two cryptocurrencies is also in correlation with Bitcoin, and if the price of Bitcoin drops below $35000 support, we can see new lows for Dogecoin (DOGE) and VeChain (VET).

Technical analysis of Dogecoin (DOGE)

Dogecoin is a derivative of Luckycoin that Jackson Palmer and Billy Markus created. Dogecoin has one-minute block intervals making it faster than other blockchains, while its large supply and low price facilitated efficient micro-tipping content on social media.

Dogecoin (DOGE) has collapsed from the recent high above $0.20, and for now, everything indicates that we could see even lower prices for this cryptocurrency. The price of DOGE currently stands at around $0.13, and at this value, the total market cap of Dogecoin is approximately $17 billion.

Doge price analysis

If the price drops below $0.10, which represents very strong support, the next target could be located around $0.07 or even below. Dogecoin (DOGE) remains in the “bearish phase”; still,  if the price advances above $0.20 resistance, the next target could be located around $0.25.

Technical analysis of VeChain (VET)

VeChain is a blockchain platform designed to track enormous amounts of data through a trust-free and distributed business ecosystem. VeChain ( VET) has weakened from its recent highs above $0.060, and the risk of further declines is not over yet. The price has stabilized now above $0.040, but we can expect that the price could test this level again in the upcoming hours or even minutes. According to technical analysis rules, a break below $0.040 support would indicate that VET could probably test the $0.030 level.

VeChain (VET) remains in the “bearish phase”; still, if the price advances above $0.060 resistance, the next price target could be located around $0.080.

Conclusion
Risk aversion continues to dominate financial markets as the uncertainty of potential outcomes between Ukraine and Russia continues to worry investors. The crypto market has lost billions of dollars in a very short period, and it could fall even more if the situation worsens as investors look for safer places to invest their money. Speculation about the Federal Reserve's next move also weighed on the cryptocurrency market after Fed Bank President John Williams said that it would be appropriate to hike interest rates in March.