- DOGE has a bearish bias despite a 16% rally a few days ago.
- The mood in the futures market was bearish after the last 10 days of losses.
Dogecoin (DOGE) showed strong signs of a bearish trend reversal. Market structure and momentum have been weak, with losses of 12% to 22% expected based on price movements over the past 10 days.
Unsubstantiated claims that Dogecoin mascot Kabuso passed away on January 10th caused the price to rise to $0.083. AMBCrypto confirmed that this was not the case and highlighted memecoin’s social metrics.
The volatility was not entirely unexpected.
Source: DOGE/USDT on TradingView
Looking at the 12-hour price chart above, we can see that the $0.085 area was met with strong resistance in mid-November. In early December the area was moved to support and defended for another month.
The intense selling on January 3rd has once again turned the region into a supply zone. It was tested again as resistance on January 11th. Bulls attempted to push the price above $0.087 but failed. H12 Market structure and momentum based on RSI showed that the downtrend was dominant.
On the other hand, OBV showed an upward trend last week. Despite the decline over the past two weeks, it hasn’t taken much of a hit. This means that sales volume is not large. However, traders can expect losses to continue.
Fibonacci levels (light yellow) show that the 61.8% level acted as resistance during the rally attempt. Subsequent rejections meant that the 23.6% southward expansion level was the next target.
Increased spot purchases could lead to another rebound.
Source: Coin Analysis
Since January 3, open interest in the DOGE contract has decreased from $400 million to $282 million. This slide, combined with falling prices, points to bearish sentiment and dampens buying in the futures market.
Realistic or not, DOGE’s BTC market cap is as follows:
However, since January 9, spot CVD has shown a slight upward trend. This was a sign of demand.
If buyers can sustain this, it could entice futures traders to enter the market and push DOGE higher. The $0.08188 and $0.0835 levels are important resistances during the lower period.
Disclaimer: The information presented does not constitute financial, investment, trading, or any other type of advice and is solely the opinion of the author.