The Dogecoin market has encountered severe fluctuations: $1.85 million liquidated in 4 hours, with longs suffering heavy losses.
The cryptocurrency market has recently experienced violent fluctuations, with mainstream coins' prices retreating to previous lows, making Dogecoin (DOGE) the focus.
According to the latest data from Coinglass, in the past 4 hours, the Dogecoin market experienced a massive wave of liquidations, with a total liquidation amount reaching $1.85 million, among which long positions suffered particularly heavy losses amounting to $1.8 million, while short liquidations were only $52,750, creating an astonishing imbalance with a liquidation ratio of 3,444%.
This sudden liquidation storm directly reflects the drastic shift in market sentiment. Just the day before, Dogecoin's price had surged to $0.167, triggering strong expectations among investors for a continued upward trend.
However, the situation took a sharp turn, and the token's price fell contrary to the trend by 4%, standing at $0.150 at the time of writing. Analysts pointed out that a large number of traders established long positions near the price peak and were ultimately forced to liquidate as the price corrected, forming a vicious cycle of 'longs killing longs'.
The technical analysis shows a key turning signal: wedge consolidation brewing a breakout opportunity.
Despite the weak short-term trend, technical charts suggest that Dogecoin may be brewing a significant turning point opportunity. The current price continues to fluctuate above the key support level of $0.150, forming a typical descending wedge pattern. This technical structure has historically often indicated a subsequent bullish breakout.
It is worth noting that the RSI indicator of this meme coin has rebounded from the oversold area to the 40 level, and the MACD histogram also shows signs of flattening, suggesting that the downward momentum is weakening.
If Dogecoin can effectively break through the upper trendline of the wedge, it may trigger a strong rebound, with a short-term target of $0.30, and in the medium-to-long term, it may even challenge the range of $0.48 to $0.65. Compared to its historical high of $0.7316, the current 78% deep correction has instead created a potential high-reward opportunity.
However, traders need to remain vigilant, as the high volatility nature of the cryptocurrency market means that risks and opportunities coexist, especially during this sensitive market sentiment period, where any directional breakout could trigger a chain reaction.
