DOGE price has been facing a downturn since August 11, which may contribute to forming a bullish structure. Bitcoin’s price volatility has affected most crypto assets, including Doge, which is down 4.2% over the last 24 hours and is trading at $0.0988. Analysis of traders shows there are twice as many Shorts as there are Longs, which means Dogecoin price may experience a short drop before reversal.
Spot Traders are Killing DOGE Price
The recent downturn in DOGE’s price can be attributed to futures traders shorting the asset in response to Bitcoin’s struggle to break through a key resistance level.
Additionally, Solana experienced record outflows of $39 million amid a sharp decline in meme coin trading volumes. Messari Research data shows Shiba Inu and DOGE may be the most affected as real trading volume dropped to $29 million and $180 million, respectively. It could be a speculation that investors are cautious and not blindly aping into meme coins.
Over the past 12 hours, DOGE’s funding rate has been increasing while its price has been dropping, indicating that futures traders are likely selling off their Dogecoins.
Additionally, an analysis of the Coinglass DOGE Liquidation Map reveals that cumulative short liquidation leverage is twice as high as the shorts themselves. This imbalance suggests that the majority of traders are bearish, anticipating further price declines.
There is a significant cluster of orders around $0.0984, which acts as a temporary support zone for DOGE. If the price rises and triggers the liquidation of the substantial shorts near $0.1017, it could set off a cascade effect, driving the price up to $0.1152.
The Coinglass Crypto Derivatives Visual Screener, which compares changes in open interest (OI) and price, shows that more shorts are being opened.
This indicator divides crypto assets’ price, and OI changes into four quadrants, providing further insights into traders’ sentiments and the potential future trend of the asset.
Dogecoin Price Needs to Clear $0.1017 First
Despite the aggressive selling by spot traders, DOGE technical analysis shows there is hope for the asset, and a bullish falling wedge pattern emerges. This pattern usually precedes a breakout to the upside 62% of the time. However, if the volume is not enough, it can break downwards.
DOGE price will likely find resistance around $0.1050 and $0.1153. Breaking and holding above this would confirm a potential reversal into an uptrend.
The Stochastic RSI is currently at 6.61 (K%) and 29.51 (D%), which is in the oversold region. This suggests a potential bullish reversal could occur soon, especially if the price holds above the lower boundary of the triangle.
DOGE price prediction shows that if it breaks below $0.0990, it may indicate market weakness and invalidate the bullish thesis. Dogecoin may drop to $0.0950 or lower.
DOGE is at a critical juncture within the falling wedge pattern. A breakout from this pattern will likely dictate the next significant move. While the pattern itself is a bullish indicator, if traders continue exerting selling pressure on the asset, it may invalidate the bullish thesis.
The post Can Dogecoin Price Surge 15% as Meme Coin Hype Dies? appeared first on CoinGape.
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