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Dogecoin open interest nears record low: Is this the end of DOGE’s 2024 rally?
As we approach the end of the year, the Dogecoin (DOGE) market is experiencing a crucial moment. The cryptocurrency’s open interest has plummeted to a record low of $1.42 billion, a stark contrast to its April peak of $12 billion. This sharp decline is coupled with a recent 20% drop in price, casting doubt on whether DOGE can recover and continue the rally it experienced throughout 2024.
The significant drop in open interest (OI) highlights reduced trader optimism, which may have contributed to the current bearish sentiment. Historically, a decreasing OI has been correlated with declining liquidity and demand, often seen as a bearish signal for the asset’s price trend.
Furthermore, Dogecoin is struggling to reclaim key support levels, as the price has dropped below $0.35. The MACD indicator reinforces this negative outlook, as it remains in negative territory, with a histogram showing fading bearish pressure but no clear signs of a reversal. In the short term, DOGE may test the $0.27 support level if the current bearish momentum persists.
However, a potential recovery could be achievable if buyers are able to push the price back above $0.35 and maintain the upward momentum. This is contingent upon increased volume and renewed buying pressure, both of which appear muted at this time.
In conclusion, the recent decline in Dogecoin’s open interest and failure to reclaim key support levels may signal a potentially grim short-term outlook for DOGE.
Source: ambcrypto.com
