The price of DOGE lost critical support this week, weakening bullish arguments.
Key points to understand:
The recovery of Dogecoin from December's lows seems to have ended.
The DOGE price has fallen below a key Fibonacci retracement level, weakening the long-term uptrend since August.
The market's largest meme coin, Dogecoin (DOGE), fell below a short-term uptrend line on Monday, marking the end of the rebound from December's lows and potentially ending a five-month bullish trend.
Since then, the price has fallen below the 38.2% Fibonacci retracement level of the rally that started in August, which peaked at about 48 cents in December before retracing. A golden rule of technical analysis is that for the market to maintain the current trend, it must stay above that level. If it fails to do so, the trend has ended.
The Moving Average Convergence Divergence (MACD) histogram is forming deeper bars below the zero line, another sign of strengthening bearish momentum. The 5-day and 10-day simple moving averages trend south, indicating a bearish bias.
Support is around 26 cents, which is the low recorded on December 20, followed by 23.4 cents, which is the 61.8% retracement level of the rise from August to December. DOGE needs to recover from December's lows to the uptrend line to invalidate the bearish outlook.
The chances of Dogecoin ETF approval have surged.
On the popular betting site Polymarket, the odds for a spot trading exchange-traded fund (ETF) for Dogecoin have surged to 56% this year.
In contrast, as of early January, the likelihood of such products being approved was only 23%.
Bitwise, a leading global cryptocurrency index fund manager, has officially submitted an S-1 filing to the U.S. Securities and Exchange Commission (SEC) to launch a Dogecoin ETF.
According to U.Today, REX Shares has also recently submitted a Dogecoin ETF filing.
According to CoinGecko, the price of the leading meme coin has dropped by 2.1% in the past 24 hours.
It remains unclear whether the new SEC administration will approve foreign meme coin ETFs.
Turle Capital has recently applied to launch a Solana-based BONK ETF.
Down nearly 16% in seven days.
Dogecoin's open contracts fell by $1.7 billion due to the drop of the original Meme Coin. Dogecoin is struggling after being hit hard this week: this largest and oldest meme coin has fallen nearly 16% in seven days.
This is bad news for Dogecoin investors: in the past week, Dogecoin has performed the worst on the cryptocurrency leaderboard, and the amount of funds betting on the asset's future price is decreasing.
Data from CoinGlass shows that the open contracts of the original meme coin are currently close to $3.8 billion. On January 17, this contract reached an all-time high of $5.5 billion.
Open contracts refer to the total value of futures contracts that traders have not yet settled.
CoinGecko shows that after a nearly 4% drop in 24 hours, the price of Dogecoin is currently slightly above $0.32.
In the past week, its price has dropped nearly 16%—making it the second-largest drop among the top 20 tokens and coins, second only to Sui.
Yesterday, the cryptocurrency market was hit hard as investors sold off tech stocks due to the rise of China's AI model DeepSeek. Digital currencies and tokens have recently been in line with the Nasdaq.
Despite a rebound in Bitcoin, the most volatile assets in the digital asset space continue to be hit hard, with meme coins like Dogecoin facing significant troubles.
Other meme tokens have also seen a significant drop in the past week. President Donald Trump's TRUMP, which operates on the Solana chain, has dropped over 37%, currently priced at $27.
Meanwhile, another leading Solana meme token, Bonk, has dropped over 30% during the same period, reminding meme coin holders that huge gains can quickly turn into steep declines.