Dogecoin (CRYPTO: DOGE) fell through a support level at $0.135 on Friday, after struggling to hold above the level for the 24-hour trading period.
If the crypto would have held above the key support area, Dogecoin would have printed a quadruple bottom pattern, making it likely to bounce up higher over the weekend. When the crypto fell below the level, however, Dogecoin printed a lower low, which set the crypto into a downtrend.
A downtrend occurs when a stock consistently makes a series of lower lows and lower highs on the chart.
The lower lows indicate the bears are in control while the intermittent lower highs indicate consolidation periods.
Traders can use moving averages to help identify an uptrend with descending lower timeframe moving averages (such as the eight-day or 21-day exponential moving averages) indicating the stock is in a steep shorter-term downtrend and descending longer-term moving averages (such as the 200-day simple moving average) indicating a long-term downtrend.
A stock often signals when the lower low is in by printing a reversal
Full story available on Benzinga.com