At the time of writing, the price of Dogecoin (DOGE) is at $0.0775 and Bitcoin (BTC) is aiming to test $29,500 again. Uncertainty continues for now, but if BTC can close above $29,700, the bearish sentiment could fade away. Despite the Federal Reserve meeting taking place two days ago, the BTC decline that negatively impacted the overall market sentiment has not reversed.
Last week, Dogecoin’s price surged by 20% as the markets reacted to Elon Musk’s decision to change Twitter’s name to “X” with a tweet. The billionaire’s close relationship with the DOGE community triggered the price increase following this announcement.
While investors tried to highlight the potential rise of DOGE amidst the extensive changes on Twitter, the excitement faded away after a week, and on-chain data shows that Dogecoin’s price has lost momentum.
If the bears are proven right, we could see the price lose $0.7 in the short term and establish a new low between $0.068 and $0.065.
As the RSI fell below the critical level of 70, confirming the dominance of sellers, Dogecoin investors seem to be actively seeking short-term opportunities to sell their coins. IntoTheBlock’s Market Depth graph confirms this bearish outlook by indicating that bears are starting to create sell walls.
As shown below, bears have active orders to sell 193 million DOGE, which is more than 30% above the current price. Meanwhile, there is a significantly higher order of 170.93 million DOGE from buyers. This means that sellers may have to lower prices to compete and fulfill their orders.
As Dogecoin’s price loses momentum, the $0.075 support level could be crucial to avoid a prolonged downtrend. However, if investors who bought 23.8 billion DOGE at this level do not sell at a loss, it could prevent further losses.
Currently, while the $0.085 target remains intact above $0.08, the RSI and the current state of BTC suggest that a downward movement is more likely for DOGE.