Dogecoin’s price continued its downward trend on Monday, falling to a low of $0.1628, marking its lowest level since March 12. This drop represents a significant decline of over 66% from its highest point in December, when it was trading at around $0.4836. The drop in price has coincided with broader market fears as both the crypto and stock markets are under pressure. Investors have been embracing a risk-off sentiment ahead of Donald Trump’s so-called "Liberation Day," when he is expected to impose reciprocal tariffs on most US trading partners, a move that could potentially push the global economy into a recession.

This heightened uncertainty has caused a dip in market sentiment, with the crypto fear and greed index sliding into the fear zone at 24. Meanwhile, the stock market's gauge of fear has dropped even further, hitting the extreme fear zone at 18. Amidst these concerns, however, there is a glimmer of hope for Dogecoin and other cryptocurrencies. The increasing odds of a recession could prompt the Federal Reserve to intervene. Historically, during major financial crises, such as the COVID-19 pandemic and the Global Financial Crisis, the Fed has responded by cutting interest rates and implementing quantitative easing, which could potentially benefit the crypto market.

Looking at Dogecoin’s price action, the daily chart reveals a strong downtrend that has persisted for the past few months. From a high of $0.4836 in December, Dogecoin has now dropped to $0.1630. It has also fallen below the 200-day Exponential Moving Average, signaling that bears are currently in control. The price has broken through a key support level at $0.2260, which was the highest swing seen on March 28 last year. This level also marked the upper side of a cup and handle pattern that had been forming throughout 2023.

Despite these losses, there are some positive signs for Dogecoin. The coin's lowest level this year was $0.1430, which was the highest swing point on July 21. More importantly, a rare bullish reversal pattern, known as the falling wedge, has formed on the chart. The price has already moved above the upper side of this wedge, which often indicates that a reversal could be imminent.

Currently, it seems that Dogecoin is attempting to form a double-bottom pattern at the $0.1430 level, with the neckline of the pattern located at $0.2057. If this pattern plays out, the coin could face further declines towards $0.1430 in the short term, particularly ahead of the tariff announcement. However, should the price hold this level and form the double-bottom, there is a possibility that Dogecoin could rally to $0.2628, a 60% increase from its current price.

If Dogecoin falls below the key support at $0.1430, however, this bullish outlook will be invalidated, and the coin could face further losses. Therefore, while the current market sentiment remains cautious, investors will be closely watching these technical levels to gauge whether Dogecoin will manage to break its bearish trend and make a significant recovery in the coming months.