Is Dogecoin Price Heading Lower? Analysts Predict Key Levels

Dogecoin (DOGE) price recently suffered a steep price drop which has traders focused on its immediate market response.

Market analysts established important price levels for short positions. Dogecoin lost more than 40% of its value during the previous month.

Some market experts expect volatility to rise but other analysts see potential for a sustained upward price movement.

Analysts Set Short Targets for DOGE Price

Dogecoin traders may be looking for a short position in the key levels identified by market analysts.

According to technical analysis, the DOGE has made downward momentum, causing some analysts to issue sell signals.

TradingView analyst pullback signal is showing that traders can use this as an opportunity to enter short positions with a $0.217 stop loss.

Potential profit-taking levels for short trade are: $0.179, $0.163, and $0.144.

In addition, the movement of these targets is determined by technical indicators like Fibonacci retracement levels, RSI, moving average, and Ichimoku cloud.

A recent sell-off has pushed DOGE down several support zones where price movements are closely watched by traders.

According to analysts, if DOGE maintains the current course, these levels may act as the profit-taking levels for short positions.

Dogecoin Dropped 40% in 30 Days

However, over the past month, DOGE price has experienced a steep value loss of about 40%.

Currently the cryptocurrency is trading at around $0.20, which is down from its earlier highs.

With the trend having been down, key support zones are under pressure. This depreciation may not be over just yet.

Although DOGE has recently dropped, it is still up 90% year by year. Which means the long-term holders are still in profit.

Yet short-term traders are keeping an eye on the price action as the asset has been unable to maintain its uptrend.

Now, according to analysts, the current price level may well become a critical pivot point as to whether DOGE stabilizes or falls further.

Dogecoin Futures Open Interest Fell 67% in Three Months

More so, Dogecoin price declines have occurred in line with a massive decline in futures market open interest.

According to Glassnode, open interest has plummeted by 67% in the past three months and is now down to $1.33 billion from $4.07 billion recorded in December.

Open interest measures the total number of outstanding contracts in derivatives markets and is often used as an indicator of market sentiment.

A decrease in open interest indicates that traders are less keen to hold leveraged positions on DOGE and this could hint at weaker faith toward DOGE’s near-term price recovery.

Such a drop, combined with falling trading volumes, is usually linked to declining interest from investors.