Dogecoin [DOGE] extended its slip below $0.1, its critical support zone. The memecoin breached $0.09 and dipped to August 2024 lows around $0.08 before rebounding to $0.093.
At press time, DOGE traded at $0.09064, down 11.4% on the daily charts. Over the same period, the memecoin market cap fell by more than $1 billion, reflecting substantial outflows.
Dogecoin faces bearishness
DOGE exhibited stubborn weakness as the market shifted entirely bearish, and traders aggressively liquidated their positions.
On the spot side, for example, the market exhibited total seller dominance. According to Coinalyze data, the memecoin recorded 3.1 billion in Sell Volume between the 5th and 6th of February.
Over the same period, the memecoin recorded 2.6 billion in Buy Volume, leaving the market with a negative delta of 400 million.
Often, a negative buy-sell delta suggests that sellers have the upper hand in the market and that their attempts have been futile.
A sustained period of increased selling activity intensifies downward pressure, often a prelude to lower prices, as recently observed.
On the futures side, traders aggressively closed their positions as they derisked and deleveraged. CoinGlass data showed that Dogecoin recorded $2.22 billion in Futures outflows compared to $2.18 billion in inflows.
At press time, the memecoin’s Futures Netflow stood at -$39 million, improving from the previously recorded -$88 million. This increase in outflows indicates that many futures market participants closed their positions, either to limit losses or secure profits.
In fact, Open Interest declined 16.7% to $986.39 million, reflecting reduced market leverage, a clear bearish signal.
Can DOGE bulls reclaim $0.1?
Dogecoin strengthened its position below $0.1, as every market participant turned bearish and aggressively closed their positions.
As a result, the downward momentum strengthened, as evidenced by the Stochastic RSI. This momentum indicator fell further into the bearish zone, hitting 13 .70 as of writing.
A momentum indicator at such low levels suggested intense downward pressure, with sellers exerting total control over the market.
At the same time, the memecoin traded below its short- and long-term Moving Averages (EMAs), further confirming downward momentum.
These market conditions leave DOGE in a weakened position, risking further price losses. Thus, if sellers continue to offload, DOGE will likely drop towards $0.08 again.
For a meaningful trend reversal, bulls must increase buying pressure and reclaim the EMA20 at $0.11, setting the stage for a move towards $0.12.
Final Thoughts
- DOGE continued its bearish streak, breached $0.09 slevel and fell to August 2024 lows of $0.08
- Dogecoin weakness persisted as investors across the market aggressively closed positions.
