Here’s why Dogecoin must recover $0.08 to offer buyers any hope


Disclaimer: The information presented does not constitute financial, investment, trading or other advice and is solely the opinion of the author.

  • Pullback below 78.6% meant Dogecoin could trade range bound
  • Long positions have spiked en masse in December so bulls need to remain cautious

Bitcoin had a quiet couple of days as volatility died down over the weekend. He could come back strong on Monday. Stock indices like the S&P 500 have been bearish for the past week, and December 19 could set the trend for the next week.

Read Dogecoin [DOGE] Price prediction 2023-24

Dogecoin fell back to a support region at $0.072 and experienced a 4% bounce over the past two days, but open interest was weak. However, it still faced resistance at $0.08, a level that has been significant for the past month. Can the bulls recapture this level and push higher?

A bullish order block rescues Dogecoin, but this could not be more than a temporary reprieve

Source: DOGE/USDT on TradingView

Based on the late November move from $0.071 to $0.119, a set of Fibonacci (yellow) retracement levels were drawn. At the time of writing, the price has sunk below the 78.6% retracement level. It found a bullish order block, marked in cyan, above the support level of $0.072.

The near full retracement meant that Dogecoin was probably range trading and not in a strong trend. The Relative Strength Index (RSI) swung from strongly bullish to strongly bearish momentum despite DOGE not showing a longer-term trend since mid-November. On-Balance Volume (OBV) also sank below a support level since late November.

Together, they suggested that the sellers were dominant. A daily session closing below $0.071 would likely start a bear leg for DOGE. However, the brave bulls may look to bid the asset within this zone.

The $0.8 level was flipped to support before the rise to $0.119 a couple of weeks ago. As a horizontal level and as a Fibonacci retracement level, it mattered. A retest as support in the coming days may offer a buying opportunity. Take profit targets would be the break down at $0.091 and the highs of $0.11. Below $0.072, the next level of support lies at $0.065.

Open interest saw a small increase over the weekend and the funding rate remained positive

Here's why Dogecoin must recover $0.08 to offer buyers any hope

Font: coinalize

Since the beginning of December, Dogecoin has seen a session with a sharp drop in prices. These were accompanied by the liquidation of millions of dollars worth of long positions. Along with the decline from $0.119 on December 5 to $0.075 on December 16, open interest also saw a decline.

This indicated that long positions were discouraged. The funding rate remained in positive territory, which also showed that the majority of the market did not begin to accumulate short positions.

source: ambcrypto.com



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