Since its inception, Dogecoin has consistently ranked among the top ten cryptocurrencies by market capitalization, with solid market support. Rumors of potential integration with Musk's X payment system have strengthened the long-term bullish outlook. An active community has maintained the resilience of the ecosystem amid market fluctuations.
Recently, a whale purchased $1 billion worth of Dogecoin within 24 hours, and multiple companies have submitted ETF applications, reigniting institutional interest.
However, although Dogecoin's price has risen 3.5% to $0.205 since August 6, derivatives data shows a lack of strength in the rebound. Daily trading volume has dropped over 20% to $4.14 billion, with low short-term speculative participation. Open interest increased by 1.66% to $3.05 billion, but short contracts dominate, with traders generally bearish, expecting the rise to be a short-term phenomenon.
Data shows that $4.73 million in DOGE positions were liquidated within 24 hours, with shorts at $2.72 million and longs at $2.01 million, indicating significant long pressure. Over 4 and 12 hours, short liquidations reached $1.34 million and $1.66 million respectively, far exceeding longs.
Although the long-short ratio is near neutral (0.99), top traders lack bullish confidence. The overall market is cautiously optimistic, with spot price rebounds overshadowed by bearish sentiment in derivatives. If buying momentum increases, concentrated shorts could trigger a squeeze, pushing the price to $0.25.
DOGE is at a crossroads: will it break through $0.25 or crash to $0.18?
Dogecoin has stabilized above $0.20, recovering the lower Bollinger Band, but the trading channel is narrow. The daily chart indicates that $0.28 is strong resistance, while $0.23 is a key resistance level. The MACD is slightly bearish but leveling off, suggesting a potential change in momentum.
If it closes above $0.23, a bullish confirmation can be made; breaking through $0.228 accompanied by short liquidations may impact $0.25. Conversely, if it falls below $0.22 and selling occurs, it may retrace to the $0.18 support level.
In summary, Dogecoin faces a critical decision and needs to focus on the breakout situation at $0.23 and the impact of market catalysts.
