Dogecoin – Another 18% price drop may be in the pipeline as…

Key Takeaways

What’s the short-term outlook for Dogecoin?

Whereas there gave the impression to be some proof of accumulation within the chain, that is seemingly not sufficient to forestall one other 18% value drop.

Why is such a value drop anticipated?

Dogecoin’s OBV fell under its August low – an indication that gross sales quantity flooded the spot market in October.

Dogecoin [DOGE] has suffered a bearish setback previously 24 hours as Bitcoin [BTC] briefly fell to $106.3k earlier than bouncing greater. At its lowest level, DOGE reached $0.176 on Thursday, June 30.

This was a decline of 9.34% from the day’s excessive of $0.194. On the time of writing, Dogecoin confirmed sturdy short-term bearish sentiment, down 3.55%. Open interest inside 24 hours. Nonetheless, the bulls managed to defend the USD 0.175 demand zone. For now.

Significance of $0.178 and the warning signal for Dogecoin bulls

Bitcoin has been buying and selling inside a sure vary since August. This vary prolonged from $124.5k to $107.5k. The transient dip under the lows of the previous few hours prompt that there’s a likelihood of a bullish restoration, offered we see sturdy demand within the spot market.

Supply: DOGE/USDT on TradingView

Due to this fact, there’s additionally an opportunity of a Dogecoin rebound. Nonetheless, this could extremely rely upon capital inflows to the market within the coming days. Whereas the $0.175-$0.185 demand zone has been defended currently, promoting stress has additionally been excessive.

This was evidenced by the truth that the OBV shaped a brand new low, under the baseline it reached in August. In reality, the current gross sales quantity has been overwhelming. And it appeared like it will solely be a matter of time earlier than the bulls buckled below the stress.

If Dogecoin falls under $0.175, the subsequent help degree could be the $0.15 degree. This was the premise of the rising wedge sample that began in June.

Supply: Santiment

The variety of each day lively addresses fell in October. This indicated lowered community exercise and a decline in natural demand for Dogecoin. Nonetheless, the typical coin age has elevated over the previous two weeks.

This could possibly be an indication of on-chain accumulation, regardless of the spot promoting seen on the value charts. The age consumption metric has additionally seen some spikes just lately, however nothing excessive.

Total, the above findings seem encouraging, however are unlikely to be sufficient to reverse the selloff seen in current weeks. So a bearish bias and a value drop to $0.15 could be anticipated.