Amid broader market weakness, memecoins have taken the lead, but Dogecoin [DOGE] has faced sharp losses. After being rejected at $0.15, DOGE slipped into a descending channel, hitting a low of $0.08 before staging a modest rebound.
At the time of writing, DOGE traded at $0.095, down 1.46% on the daily charts, adding to 8.03% weekly decline. Despite this prolonged downside movement, analysts have turned bullish, eyeing another leg up.
Is Dogecoin’s bottom in yet?
According to a crypto analyst, DOGE has finally touched the lower line of the long-term ascending channel.
The drop to these levels signalled that DOGE might have finally reached the bottom. As such, there is no further downward path for Dogecoin.
Citing prior cycles, the analyst noted that DOGE made record-breaking moves. For instance, in the 2017 cycle, DOGE rose by 9,200% over 300 days, and in the previous cycle, it grew by 26,485% over 154 days.
Therefore, if the memecoin dips below $0.1, it implies a bottom, and a rebound could see DOGE make another uptick. If history is anything to go by, based on this analyst’s positions, Dogecoin could see a jump towards $0.3.
Market structure remains bearish
Despite analysts’ bullish projections, the market sentiment remains overwhelmingly bearish. In fact, DOGE is currently stuck within the supply zone.
Based on the Demand and Supply Zones indicator, $0.09 served as the supply zone as of writing. In this area, DOGE faced significant selling pressure, resulting in a decline to $0.08.
With DOGE stuck in a weak momentum phase, it suggests investors are aggressively offloading to latecomers. This zone now acts as strong resistance, where prices have repeatedly faced rejection.
Sellers currently dominate the market, as shown by the Buyer‐Seller Dominance indicator: seller volume reached 5.4 billion compared to just 2.8 billion in buyer volume.
A higher dominance suggests that most active participants are offloading, and Buy Sell Volume confirms this trend.
According to Coinalyze, buyers have failed to displace sellers for eleven consecutive days, with sell volume hitting 700 million in the past 24 hours.
Can history repeat itself, or will there be further losses?
Dogecoin currently faces massive downward pressure from sellers, having totally displaced buyers from the market. In fact, at the time of writing, the memecoin’s Relative Strength Index (RSI) moved bearishly, dropping to 31.
The RSI remained well into bearish territory, signalling sell-driven downward momentum. At the same time, its Directional Movement Index (DMI) fell to 6.3, validating the trend strength.
These two momentum indicators leave DOGE in a weakened position, with a likelihood of further losses. Thus, if the trend persists, CW’s projection appears unlikely.
For now, buyers provide sufficient support to prevent a further decline, and DOGE is likely to hover around $0.09, with $0.1 as the upper boundary.
For the analyst’s market perception to materialize, the market needs a broader recovery, with DOGE reclaiming its demand zone around $0.15.
Final Thoughts
- DOGE has traded within a descending channel, firmly held below the critical $0.1 area.
- Dogecoin remains structurally bearish, with sellers dominating the market, making a short-term bullish reversal improbable.
