- Summary:
- Dogecoin price has broken below a key support level and its key metrics point to an asset primed for more downward pressure.
Dogecoin price extended its decline on Friday, bringing its weekly losses to 28% in the last week. The meme coin’s decline below the psychological $0.300 mark has exacerbated a bearish sentiment that has seen it reverse gains made in the last five weeks.
The crypto market is on a downturn, with the market bellwether, Bitcoin falling from record highs of $108,364 to below $94k as of this writing. Dogecoin has seen its open interest drop by more than 30% in the last 24 hours as per Coinanalyze data, underlining a sharp drop in investor confidence in the stock.
The declining Dogecoin price momentum is also affirmed by a sharp spike in its traded volume. As seen on the chart below, the declining price trend in recent days was accompanied by a significant rise in DOGE’s traded volume. That infers that investors are selling off their coins in large troves. Dogecoin price could extend its downside if the trend continues.
Meanwhile, IntoTheBlock reports that DOGE price has recently developed a negative correlation with Bitcoin. As of this writing, DOGE’s correlation with BTC stood at -0.02. Therefore, Dogecoin price could take some time to reverse even if Bitcoin returns to the upside.
In addition, the recent market rally has been skewed toward BTC and altcoin, with little attention given to meme coins like Dogecoin. That has created a sour sentiment that could limit near-term upside for DOGE.
Dogecoin price prediction
The Dogecoin price pivot mark is at $0.305 and the downside will prevail if resistance persists at that level. That could see the first support established at $0.323. However, if the downside momentum extends, the price could move to the second support at $0.340.
Alternatively, moving above $0.305 will favour the buyers to take control. That could drive DOGEUSD up to encounter the first resistance at $0.283. Furthermore, breaking above that level will invalidate the downside narrative. Meanwhile, a stronger bullish momentum could take the price higher to test $0.260.
