Dogecoin Faces Bearish Pressure After Weekend Dip, But Analyst Sees 53% Rally Potential

MarketDash Editorial Team

14 hours ago

Dogecoin slipped lower over the weekend as cryptocurrency markets retreated, triggering a wave of short positions. Despite the bearish sentiment, technical indicators and trading patterns suggest the memecoin could still mount a significant comeback.

Weekend Selloff Erases Weekly Gains

Dogecoin (DOGE) couldn't catch a break over the weekend, falling nearly 2% as cryptocurrency markets broadly retreated. The dog-themed memecoin looked set to close the week in the red, giving back earlier gains in a reversal that frustrated bullish traders.

Trading activity told an interesting story, though. Volume exploded 87% over the last 24 hours, suggesting plenty of action beneath the surface. When prices drop but volume spikes, something's brewing.

Short Sellers Pile In

Here's where things get spicy: open interest in DOGE futures surged 4.64% in the last 24 hours, according to CoinGecko data. When open interest climbs while spot prices fall, it typically means traders are opening new short positions. Translation? Bearish bets are multiplying.

But wait. Despite the apparent pessimism, the percentage of Binance traders positioned long on DOGE actually increased from 68% to 70% over the same period, per Long/Short Ratio data. So while some traders are betting against the memecoin, others are doubling down on a rebound.

Where DOGE Could Find Support

Cryptocurrency analyst Ali Martinez, who's built a following for spotting technical patterns, identified potential support zones at $0.10 and $0.062 if the selling pressure continues.

More intriguingly, Martinez earlier identified a descending triangle pattern on DOGE's 3-day chart. If that pattern plays out as expected, he projects a bullish bounce to $0.21, roughly 53% above where the coin currently trades.

What The Indicators Say

Technical signals are painting a mixed picture. The Moving Average Convergence Divergence indicator, which compares two exponential moving averages, flashed a "Buy" signal for DOGE according to TradingView. That's typically a bullish sign.

Meanwhile, the Bull Bear Power indicator, which measures the tug-of-war between buyers and sellers, registered "Neutral," suggesting neither side has a clear advantage yet.

At press time, DOGE was trading at $0.1370, down 1.80% in the last 24 hours, according to Benzinga Pro data.

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