The cryptocurrency market is currently experiencing a turbulent phase, with both bulls and bears unable to assert control. In this environment, the meme coin sector, particularly Dogecoin, is facing intensified liquidation pressure from buyers, contributing to a bearish consolidation phase.
As the price of Dogecoin continues to decline, it is nearing a crucial support line after encountering rejection at higher resistance levels. This situation raises the question of whether Dogecoin”s price could retreat to the $0.1 mark.
In the last 24 hours, Dogecoin has seen a notable increase in bearish sentiment following its rejection at resistance levels. Data from Coinglass reveals that approximately $6 million worth of Dogecoin positions were liquidated within the same timeframe, with buyers accounting for a significant $4 million of that total.
Over the past week, Dogecoin has declined by around 6.8%, positioning it as the weakest performer among the leading ten cryptocurrencies. This downturn appears to stem from a lack of interest from retail traders, coupled with low inflow volumes into Dogecoin-focused ETFs.
Current data indicates that Dogecoin”s futures open interest has decreased to $1.77 billion, down from $1.96 billion just a week ago. This trend suggests that retail traders are opting to remain on the sidelines rather than engage in new trades involving Dogecoin”s price fluctuations. If this trend of inactivity persists, a robust price rebound seems unlikely in the near future.
The bearish outlook is further supported by the recent activity surrounding ETFs. Last Friday, Dogecoin spot ETFs registered an inflow of approximately $404,000, despite high market volatility. According to SoSoValue, U.S. spot Dogecoin ETFs had previously recorded significant inflows of $2.3 million on January 2 and $1.6 million on January 5, but the recent inflows have markedly slowed, indicating an escalating bearish sentiment for the prominent meme coin.
After being rejected near the $0.16 resistance level, Dogecoin has since retraced towards its moving averages. As of now, the token”s price stands at $0.14, reflecting a slight decline of over 0.6% in the last 24 hours. The 20-day EMA is currently situated around $0.14 and is trending downward, while the relative strength index (RSI) is just below the neutral midpoint, suggesting that sellers are dominating price momentum.
In the event of further long-liquidation scenarios, Dogecoin may drop below its moving averages. Consequently, the cryptocurrency could continue to oscillate between $0.12 and $0.16 for the foreseeable future. A confirmed drop beneath the $0.12 support level could propel the price down to $0.1.
Conversely, a bullish reversal could occur if the market disregards the breakdown beneath the $0.12 support, paving the way for a potential rise toward $0.19.
