As Bitcoin falls below $105,000, the heat of the meme coin sector quickly cools down, and market sentiment turns cautious. The latest data shows that the total market capitalization of the entire meme coin market has fallen below $60 billion, with Dogecoin (DOGE), as the leader, dropping nearly 4% in the past 24 hours, gradually approaching the key support area of $0.18. In the current situation, is it possible for Dogecoin to further drop to the low of $0.14?
Technical Aspect: Support is Urgent, Risks Dip
From the daily chart perspective, Dogecoin previously attempted to break through the supply zone at $0.25 but failed, subsequently falling below the 200-day moving average, currently hovering around $0.21, approaching the 23.60% Fibonacci retracement level.
Price trends indicate that $0.18 has become the most critical support area at present. However, the recent continuous decline has raised bearish sentiment in the market, with Dogecoin dropping 2.6% in a single day on Wednesday. If this support is lost, it will completely break the original cup-and-handle reversal expectation, and the market may face further pullbacks, testing the historical support level of $0.14.
In terms of technical indicators, the daily RSI has fallen from the previously overbought region to below the neutral level of 50, with momentum clearly biased towards the downside. This means that, in the current tug-of-war between bulls and bears, the bears have gained the upper hand. Even if there is a short-term rebound, the previous supply area around $0.21 will form a new resistance zone, limiting the rebound space.
According to Mlion.ai's on-chain sentiment monitoring, the social sentiment index related to Dogecoin trading has significantly decreased in the past 48 hours, with retail fund inflows shrinking simultaneously, indicating a lack of strong buying support in the market.
Derivatives Market: Bulls Suffer Severe Setbacks
The performance of the futures market also confirms this pessimistic trend. Data shows that in the past 24 hours, the amount of liquidated long positions in Dogecoin reached as high as $5.19 million, while the amount of liquidated short positions was only $416,000, with a long-short liquidation ratio close to 10:1, indicating that bullish positions are facing a collective liquidation.
At the same time, the open interest size of Dogecoin has decreased by 1.42%, falling to $2.07 billion, indicating that market participation is declining, and trading enthusiasm continues to wane. Although the weighted financing rate has slightly rebounded to 0.0080% after dropping to 0.0020%, it remains at a relatively low level, showing that the bullish and bearish forces in the market are still weak in the short term.
Mlion.ai's fund flow monitoring data shows that in the past 24 hours, the outflow of funds related to Dogecoin has increased, and the exchange wallet balance has risen, indicating that more holders are choosing to exit and wait.
Market Outlook: Beware of Key Support Loss
Considering both the technical aspect and on-chain data, Dogecoin is currently at a critical juncture. If the $0.18 support is effectively broken, the possibility of a dip to $0.14 cannot be ruled out. And even if a short-term rebound occurs, the dense resistance area between $0.21 and $0.22 will suppress the height of the rebound.
From a larger cycle perspective, the meme coin market is undergoing a deep adjustment. With Bitcoin's pullback combined with a cooling overall risk sentiment, the meme coin sector, which lacks fundamental support, is taking the brunt of it. The previous frenzy of capital chasing is being replaced by caution and risk aversion.
In this context, the price volatility of Dogecoin has increased, and short-term investment risks have risen. For investors, blindly bottom-fishing is akin to going against the trend. A more rational approach is to rely on AI investment research assistants like Mlion.ai to track on-chain data, market sentiment, and fund flows in real time, capturing potential reversal signals, making cautious layouts, and avoiding blind entry and exit.
Summary
Dogecoin is facing a test of technical support, with the $0.18 level being precarious. If this level is lost, $0.14 may become the next target. With the overall cooling of the meme coin market, DOGE's short-term rebound potential is limited, and investors need to be cautious of downside risks, manage their positions rationally, and implement risk management.
Disclaimer: The above content is for informational sharing only and does not constitute any investment advice!
