For Dogecoin (DOGE), September proved to be a turbulent month, starting exceptionally strong. Following a powerful surge that took the price close to its February highs ($0.30), we've witnessed a significant cool-off over the last two weeks. The price has fallen in value by nearly 25%. Crucially, this recent pullback has brought the DOGE price back to an area that has historically sparked powerful price surges. The key question now is: can Dogecoin ignite a double-digit recovery, or must the market brace itself for a more fundamental reset?

The $0.20–$0.22 Zone: Can This Spark a Dogecoin Rally?

Dogecoin has been trending upwards since June, boasting a rise of roughly 60% over the past three months. The price has respected a rising trendline that has served as a reliable support since April. Historically, previous bounces from this line have resulted in rallies of 30% to as much as 40%.

The price is currently approaching this crucial support line, which sits near the $0.22 mark. However, things become truly compelling due to the confluence of multiple critical support levels within the $0.20 to $0.22 range.

Horizontal Support & 200-day EMA: This zone encompasses both an established horizontal support line and the 200-day Exponential Moving Average (EMA). This average gives more weight to recent price action and is widely seen as a key barometer: staying above the 200-day EMA indicates that the overall uptrend remains firmly intact.

In short, the cards are on the table. If buyers successfully defend the price above $0.22 and reclaim momentum, a move towards the $0.27–$0.29 range becomes very plausible. This would unlock a 30% upside potential. However, a decisive break below the $0.20–$0.22 zone would pave the way for a rapid dip towards $0.18.

RSI Shows Bullish Momentum for DOGE

An intriguing signal is emerging from the Relative Strength Index (RSI), the popular indicator that measures the speed and change of price movements. Although the price has fallen in recent weeks, the RSI has stopped making new lows and is gently curling upwards.

This phenomenon is known as "bullish divergence": momentum is improving even as the price weakens. This often hints that sellers are running out of steam. It‘s not a guarantee, but when such a divergence develops at a historical support zone (like the $0.22 area and the 200-day EMA), the probability of a strong reversal increases.

Current DOGE Price at a Key Support Level

Respected analysts also stress that $0.20 is the most critical support level for Dogecoin. This is underpinned by on-chain data that shows where a large volume of coins last moved—and thus where large groups of holders likely made their purchases.

A historical cluster of transactions around $0.20 reinforces the importance of this level. When the price revisits such a "high-ownership zone," we typically observe two powerful market reactions. Firstly, there is the determination of strong hands; they are less inclined to sell at a loss, especially if the price is close to their initial purchase point ($0.20). Secondly, demand often reappears, as new investors looking for "value" are prone to step in at levels where previous buyers were heavily active.

In summary, the Dogecoin price is currently at a critical tipping point. If support around the $0.20–$0.22 mark holds firm, a potential 30% rebound could follow, but a drop below this threshold would open the door to a deeper correction. Time will tell if the resilience of this meme coin will prevail once more.

Disclaimer: This article is purely for informational purposes and does not constitute financial advice. The crypto market is volatile, and investing carries risks.