As sellers overtake the market, Dogecoin breaks under the key 50% Fibonacci level. Will this breakdown drop DOGE price to the next crucial psychological zone?
Amid the increasing volatility in the crypto market, as Bitcoin BTC $108 041 24h volatility: 0.7% Market cap: $2.15 T Vol. 24h: $110.76 B drops under the $102,000 mark, Dogecoin DOGE $0.19 24h volatility: 1.9% Market cap: $29.03 B Vol. 24h: $2.76 B is taking a bearish hit. The meme coin segment has dropped by 7% in the past 24 hours, bringing its market cap down to $101 billion. Dogecoin, trading at $0.3459, has declined by 4.95% in the same time frame and currently holds a market cap of $55.10 billion. The bearish momentum continues to weigh heavily on the meme coin market.
Dogecoin Takes a Hit amid Crypto Market Volatility
In the daily 4-hour chart, the Dogecoin price trend reveals a bullish failure to sustain above the 61.80% Fibonacci level at $0.37772. This failure has triggered a pullback to a local support trendline after breaching the 50% Fibonacci level. The crucial support level now stands at $0.35321, which is being closely tested.
Currently, Dogecoin is clinging to the local support trendline after forming consecutive bearish candles. The selling pressure is intensifying, resulting in a negative crossover between the 20 and 50 EMA lines. Furthermore, the 20 EMA line has dropped to touch the 100 EMA line, reflecting growing bearish dominance.
Now, limiting the chances of a bullish crossover, the 4-hour RSI line has fallen below the halfway level, adding to the bearish sentiment. Additionally, the downward trend in the RSI line warns of an impending trendline breakdown. The technical indicators suggest continued struggles for the meme coin.
Derivatives Market Sentiment: Bears Take Control
Amid the growing bearish pressure, speculations in the derivatives market are leaning further toward a downside. The open interest has dropped by 8.71%, standing at $4.49 billion. This reflects declining interest from bullish players as confidence wanes.
Additionally, the long-to-short ratio has slipped to 0.90%, further indicating reduced bullish participation. However, the remaining bullish players seem willing to pay a premium, as reflected by the rise in the funding rate to 0.0103%. Despite this, the overall sentiment in the derivatives market remains predominantly bearish.
Dogecoin Key Levels: Support and Resistance
Dogecoin stands at a crucial crossroads as the price nears critical levels. A failure to hold the support level at $0.35321 could lead to a retest of the $0.30 psychological zone at the 23.6% Fibonacci level. This scenario indicates a downside potential of nearly 12%, which could further challenge market confidence.
On the other hand, if the broader market stabilizes, Dogecoin may stage a recovery. A bullish rebound could allow the price to re-challenge the 61.80% Fibonacci level at $0.37772. Overcoming this resistance would signify a potential shift in momentum and revive bullish hopes.
Dogecoin faces significant bearish pressure, with a nearly 12% downside risk if key support levels fail. However, a broader market stabilization could provide a much-needed lifeline, sparking a recovery and re-challenging resistance levels. For now, the bearish trend dominates, but the potential for reversal remains if bulls regain strength.
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