Dogecoin’s open interest has recently fallen by 20% to $1.42 billion, indicating a decline in investor confidence. While the coin’s dollar-based investment period has come to a standstill, bear market expectations are gaining strength. DOGE’s price could fall by 27% to $0.32, but a recovery could occur if the 35% support level is regained.
In April, Dogecoin (DOGE) reached a high of $12 billion in terms of open interest. However, this peak was followed by a major pullback and a serious drop in October. Although a brief spike was seen in early December, Dogecoin is currently nearing its lowest levels since November 10.
The 20% drop in the indicator known as Open Interest (OI), in parallel with DOGE’s price action, shows that traders are losing confidence in investing. OI represents the total number of contracts open in the futures and options markets. The increasing OI reflects the addition of new positions and the confidence of market participants in price action. However, the decrease in OI shows that traders have a more neutral outlook and believe that price action will not yield profit in the short term.
If this situation continues, Dogecoin’s price could drop to $0.32, which could lead to a long-term correction. Another important indicator is Dogecoin’s Average Dollar Investment Duration (MDIA), which shows how long coins have been held in wallets. When MDIA increases, it indicates that coins are no longer actively traded and the market is stagnating. According to Santiment data, Dogecoin’s 90-day MDIA has increased, indicating that holders are continuing to hold onto their coins and the market is stagnating. This could reinforce the downtrend.
On the daily chart, DOGE continues to lose important support levels. In particular, the drop below the $0.35 support level shows that the bulls are unable to defend this area. The MACD (Moving Average Convergence Divergence) indicator also supports this decline. A negative MACD reading indicates that the momentum is bearish. If this situation continues, the DOGE price could drop to $0.27.
On the other hand, if the bulls manage to regain and defend the $0.35 support level, this trend could change and DOGE could rally towards $0.48.