Dogecoin is currently trading at approximately $0.137, remaining ensnared in a descending channel as it continues to feel the weight of Bitcoin’s recent decline. The memecoin has seen a steady decrease in value, testing crucial support levels while sellers dominate the market momentum.
This downturn follows the Federal Reserve’s recent 25-basis-point interest rate cut. Despite market expectations, this decision, coupled with divisions among policymakers and persistent inflation fears, ignited a broader risk-off sentiment that significantly impacted cryptocurrencies, particularly memecoins like Dogecoin.
Last weekend, Bitcoin’s price dipped below the $90,000 mark, amplifying selling pressure across high-risk segments of the crypto space. In this context, Dogecoin experienced heightened selling activity, despite the absence of any negative news specifically related to DOGE, reflecting more extensive shifts in trader positioning rather than any token-specific developments.
The trading volume surrounding Dogecoin surged by an astonishing 87% in just 24 hours, with the price plummeting nearly 2%. As a result, the dog-themed memecoin is poised to finish the week in the red, erasing earlier gains seen at the start of the week.
Speculative trading activity has increased as Dogecoin prices have fallen. Open interest in DOGE futures has risen by 4.64% in the past 24 hours according to market indicators, signaling that traders may be adopting new short positions amid bearish sentiment. However, data from Binance reveals an increase in the proportion of traders holding long positions, which has risen from 68% to 70%, creating a somewhat conflicting picture of market sentiment.
Technical Indicators Suggest Continued Weakness
Analyzing the daily chart, Dogecoin remains within a descending price structure, which has been pushing prices lower since the peak of nearly $0.31 recorded in October. Each recent recovery attempt has failed to break through downward resistance levels.
Technical indicators highlight that Dogecoin is trading below all significant moving averages. The 20-day exponential moving average is positioned at around $0.144, while the 50-day EMA is higher at approximately $0.159. Longer-term EMAs such as the 100-day and 200-day stand even farther away at $0.179 and $0.194 respectively.
The Parabolic SAR indicator has been consistently positioned above the price, reinforcing the overall downside pressure. Until Dogecoin can reclaim at least the 20-day EMA, any potential bounce will lack a strong structural confirmation.
Current support for DOGE lies between the $0.137 and $0.135 range, correlating with recent session lows and an earlier consolidation base established in April. A breach of this level could open the door for further declines towards $0.130 and potentially down to $0.120 if bearish momentum continues.
Despite prevalent downside, momentum indicators on shorter timeframes suggest a decrease in selling pressure. The one-hour chart indicates that DOGE is trading within a downward-sloping channel, with some signs that the selling intensity is easing near lower boundary levels. Moreover, the Relative Strength Index (RSI) has bounced back from oversold territories, currently lingering in the low-to-mid 50s.
Analyst Insights on Vital Support Levels
Technical analyst Ali Martinez has identified critical support levels for Dogecoin at $0.10 and $0.062. Martinez also highlighted a descending triangle pattern depicted in DOGE’s 3-day chart, which could signal a possible rebound to $0.21, indicating a potential upside of roughly 53% relative to current levels.
The Moving Average Convergence Divergence (MACD) indicator recently issued a “Buy” signal for Dogecoin, while the Bull Bear Power indicator reflects a “Neutral” reading, indicating a balance between buying and selling pressures.
On-chain metrics illustrate a mixed environment. The Network Value to Transaction ratio has decreased by about 14% over the last quarter, suggesting a rise in transaction activity in comparison to market value. Nevertheless, older data from October showed the NVT spiking to a three-month high near 93.4, indicating fluctuations in market health.
In terms of whale behavior, some large holders have reduced their positions since October, while others have been accumulating, as recently evidenced by a significant transfer of 352 million DOGE from Bybit to unknown wallets, although this accumulation has not yet translated into price stabilization.
To restore momentum significantly, Dogecoin needs to demonstrate a sustained move above the $0.140 level, representing a critical threshold that would validate short-term resistance and encourage bullish sentiment moving forward.
