DOGE’s value drops below $0.13 as investor trust wanes
The cryptocurrency market is experiencing a period of underperformance, particularly impacting memecoins during bearish market conditions. Dogecoin (DOGE), a prominent memecoin, has faced significant challenges recently, with a nearly 5% drop in its value over the past 24 hours, pushing it below a crucial support level. Amidst a bearish market environment and diminishing retail interest, the outlook for Dogecoin appears bleak, with a key target of $0.10 now in focus.
One of the primary reasons behind the recent struggles of DOGE is the decreasing retail interest in the coin. Data from Santiment reveals that significant DOGE holders, ranging between 100 million to 1 billion tokens, have reduced their holdings from 36.14 billion to 34.77 billion since December 1. On December 10, these investors offloaded over 1 billion DOGE, with this trend continuing relatively steadily. Additionally, the total proportion of DOGE in profit has declined to 50.70% from 53.95% on December 3.
Analyzing derivatives data from CoinGlass further emphasizes Dogecoin’s weakening position within the broader crypto market amid impending events such as the US Consumer Price Index (CPI) release and the Bank of Japan’s rate decision. Short positions in DOGE derivatives have surged to 53.91% from 52.59% on Wednesday, signaling the anticipation of a price decline in DOGE. This sentiment is echoed by the eradication of over $5 million in DOGE long positions over the past 24 hours.
The recent performance of DOGE supports the possibility of a sustained downtrend, with a 9% loss in value over the past week, currently trading around $0.125. Technically, DOGE faces a challenging environment as it dipped below the $0.13 threshold, marking its lowest daily close since October 17, 2024, amidst a third consecutive week of losses. Should this bearish trend persist and DOGE closes below the $0.1231 support, further downside towards the $0.100 psychological level could ensue.
Key technical indicators also align with the bleak outlook for Dogecoin. The Moving Average Convergence Divergence (MACD) on the 4-hour chart signals continued downside momentum following a recent crossover below its signal line. Moreover, the Relative Strength Index (RSI) hitting 31 with a downward trajectory towards oversold conditions underscores intense bearish pressure on DOGE.
Nevertheless, a potential reversal could occur if bulls manage to reclaim control and DOGE closes above the $0.1231 level, potentially leading to a rally towards the 50-day Exponential Moving Average (EMA) at $0.1556 in the near term. The dynamic market conditions and shifting investor sentiment will play a crucial role in determining the future trajectory of Dogecoin amid ongoing market uncertainties.
