Popular memecoin Dogecoin [DOGE] appears set to continue its downward move in the coming month amid ongoing geopolitical tensions and a bearish market structure.
According to TradingView, DOGE has fallen over 42% in the past three weeks and is now struggling at a key level while forming a bearish pattern, indicating that a major decline may be on the horizon.
On the 2nd of March, DOGE declined by over 2.15% in the past 24 hours, trading at $0.092 at press time.
During the same period, market participation also plummeted, as reflected in the trading volume, which tanked by 32% to $1.07 billion, indicating fear among traders and investors compared to the previous day.
DOGE signals a 35% downside risk
Looking at the daily chart, DOGE appeared bearish at the time of writing, forming a bearish head and shoulders pattern and hovering at the neckline of $0.0874.
Based on the current price action, if the memecoin breaks down and closes a daily candle below this level, it could see a strong downside move of over 35% and may reach the $0.0559 level.
However, the DOGE bearish thesis would only work if it breaks down below the $0.0874 level; otherwise, it could be invalidated.
As of now, the technical indicator Average Directional Index (ADX), which measures an asset’s trend strength, has fallen to 22.75, below the key threshold of 25.
This indicates that DOGE has weak directional momentum and may not continue its strong bearish move.
DOGE turns bearish despite accumulation
Despite the bearish market sentiment, long-term holders appear to be accumulating the token, as shown by the derivatives data platform CoinGlass.
The latest DOGE Spot Inflow/Outflow data revealed that over the past 24 hours, more than $6.24 million worth of the memecoin has flowed out of exchanges, hinting at potential accumulation.
The sentiment of intraday traders remained the same, as they appeared to be following the current market trend.
As of press time, DOGE’s exchange liquidation map discloses that intraday traders are strongly betting on $0.0904 on the lower side (support) and $0.0956 on the upper side (resistance).
At these levels, traders have built $5.94 million worth of long-leveraged positions and $14.17 million worth of short-leveraged positions.
These positions suggest that intraday sentiment for DOGE is bearish, as sellers are significantly outperforming buyers.
Final Summary
- Dogecoin has formed a bearish head and shoulders pattern. If the memecoin fails to sustain the $0.0874 level, it could see a price dip of over 35%.
- An expert has confirmed extreme weakness in DOGE, while another has noted $0.058 as an ideal accumulation level.
