04 Dec 2024

Dogecoin's price fell to approximately $0.40 on Tuesday, representing a 16% decrease for the day. The open interest for DOGE decreased by $380 million as traders responded to the unsuccessful attempt to break through the $0.50 mark on Monday. Technical indicators suggest that the DOGE price is currently trending below its 20-day average, indicating a sustained decline in market demand.

Dogecoin's price remains stable below the $0.40 mark on Tuesday, reflecting a decline of 16% within the daily timeframe.

Following several unsuccessful attempts to surpass the $0.50 threshold over the past week, speculative investors have begun to reduce their DOGE holdings.

Is there a potential for Dogecoin's price to enter a significant correction phase?

The price of Dogecoin fell to $0.40 amid a wave of profit-taking activities.

Concluding the month with a remarkable 175% increase, Dogecoin has established itself as one of the top-performing mega-cap cryptocurrencies in November.

After reaching a high of $0.45 around November 22, DOGE has faced challenges in gaining momentum as traders started to secure their profits.

On Monday, the global cryptocurrency market experienced a substantial uplift due to several positive developments, including Microstrategy's acquisition of $1.4 billion in Bitcoin and WisdomTree's application for a Ripple (XRP) ETF.

XRP, Monero (XMR), and Litecoin (LTC) have emerged as the leading gainers in the market; however, the prices of Dogecoin and Bitcoin have remained relatively flat, staying below the significant thresholds of $0.50 and $100,000, respectively. As of Tuesday, Dogecoin experienced a notable decline of 16%, dropping to $0.40 after reaching a peak of $0.45 during the rally on Monday.

The accompanying chart illustrates how Dogecoin's price movement closely followed Bitcoin's 5% decrease over the past 24 hours. Following a failed attempt to break through the $0.50 barrier, Dogecoin traders withdrew $380 million from the market.

Despite achieving a three-year high of $0.48 on November 23, Dogecoin has struggled to maintain upward momentum. After a period of stagnation lasting a week, short-term traders are beginning to reduce their positions in DOGE. Supporting this trend, Coinglass’ open interest chart below monitors the value of active Dogecoin futures contracts, offering insights into traders' responses to significant market developments.

Volume Delta data shows a net negative figure of -89.44M, indicating stronger selling pressure compared to buying activity.

This imbalance reinforces the possibility of bearish continuation.A breakdown below $0.40 could trigger additional liquidations, accelerating losses toward the $0.34 support zone. 

Conversely, if DOGE manages to hold $0.40 and climb above $0.45, bulls could attempt to force a retest of the $0.50 psychological resistance.