- Dogecoin has a bullish structure on the daily but could be flipped bearishly soon.
- Traders need to remain cautious of a short squeeze as bearish sentiment rises.
Dogecoin [DOGE] showed strong short-term bearish momentum and sentiment. Buying volume was not as strong as the bulls were hoping. Bitcoin’s [BTC] correction from $64k earlier this week also hurt DOGE’s recovery.
The Futures market was not convinced of a Dogecoin recovery in the near term either. Should traders prepare for further losses, or be brave and bid the meme coin?
Dogecoin sinks to a local support zone
Source: DOGE/USDT on TradingView
Dogecoin retraced the gains it made the previous week and was trading at the psychological $0.1 support zone again. However, its momentum and volume signaled bearishness.
The Awesome Oscillator was in negative territory and indicated rising bearish momentum.
The OBV was unable to breach the local highs made earlier this month. This meant the buying volume was weak and traders must be cautious and temper their expectations of further gains.
A price bounce toward the $0.108-$0.112 local resistance is possible if the demand begins to increase. A fall to $0.095 to hunt liquidity is also possible in the near term.
Market sentiment has weakened in recent days
Source: Coinalyze
Over the past few days, the Open Interest sank lower alongside the price. The Funding Rate was also in decline and turned negative a few hours ago. Together, the data showed bearish conviction rising amongst speculators.
Read Dogecoin’s [DOGE] Price Prediction 2024-25
The spot market was not confident of a Dogecoin recovery either. The spot CVD continued to slide lower even as the meme coin prices straddled a support zone.
Overall, it appeared that a move below $0.095 was brewing.
Disclaimer: The information presented does not constitute financial, investment, trading, or other types of advice and is solely the writer’s opinion
