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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 crypto market continues to experience significant fluctuations. Dogecoin (DOGE), which recently witnessed a massive surge in value, has now faced a sharp decline, with its open interest plummeting to near-record lows. This drop raises serious questions about the sustainability of DOGE’s 2024 rally and whether this marks the end of the upward trajectory.
Dogecoin’s open interest has taken a severe hit, falling to $1.42 billion. This drastic decrease in trading activity is alarming, especially when considering that just a few months ago, it had reached an astonishing $12 billion peak in April. The sudden shift in market sentiment raises concerns about DOGE’s ability to recover from this recent downturn.
The fall of open interest has significant implications for the coin’s future prospects. This decline reflects reduced trader optimism and activity within the DOGE market, which could further exacerbate the current bearish trend. It is crucial to note that this shift in sentiment does not necessarily mean the end of DOGE’s 2024 rally; however, it does raise a few red flags for traders.
Another significant indicator, MDIA (Market Direction and Index), highlights stagnation within the DOGE market. This metric has been steadily rising over the past year to a staggering 335 days, indicating that long-term holders are not actively trading or reallocating their assets. In a market where sentiment is essential, this trend suggests reduced liquidity and decreased demand, which may further fuel the decline.
Moreover, the daily chart indicates DOGE’s struggle below key support levels following its recent price drop to $0.32. The inability to reclaim these levels highlights bearish momentum dominating the market. A crucial indicator, MACD (Moving Average Convergence Divergence), reinforces this sentiment by showing a negative territory with fading bearish pressure.
Should the bearish trend persist, DOGE may soon face significant support at $0.27. On the other hand, should buyers manage to push the price above $0.35 and maintain momentum, a recovery towards $0.48 could be achievable. This potential rebound hinges on increased volume and renewed buying pressure, which currently appear muted.
The stark contrast between DOGE’s current performance and its past surge raises concerns about the sustainability of its 2024 rally.
Source: ambcrypto.com
