After a recent widespread market downturn, Dogecoin has once again fallen below the fiercely competitive area.
The liquidation heat map highlights two important levels that may determine the next long-term trend.
In the 24 hours before publication, Dogecoin [DOGE] fell by 9.7%, but its trading volume surged by nearly 89%. This massive inflow can largely be attributed to the sell-off that occurred the previous day.
As Bitcoin [BTC] struggles to reclaim $100,000 again, Dogecoin's short-term outlook is precarious. In the coming days, the levels of $0.336 and $0.375 will be crucial.
Dogecoin bulls fail to defend the $0.37 area.
In mid-November, following a quick rebound earlier in the month, the $0.35-$0.38 area became a support zone. This support area collapsed in the second half of December, leading to DOGE dropping to a local low of $0.262.
Almost three weeks ago from the current date, DOGE performed strongly in the first few days of this year. It broke out of the symmetrical triangle pattern (in white), reaching $0.398 and reclaiming the $0.36 area as support, but has since fallen below this support level in the past 24 hours.
The next short-term support level is at $0.336, which is the lower range consolidation area before the impulsive rise on Friday, January 3.
The momentum oscillator on the 6-hour chart shows that bullish momentum is waning. The DMI also indicates a slowdown in the bullish trend, with -DI (red) crossing below +DI (green).
Temporary setback or further losses ahead?
The liquidation heat map for the past month shows that the $0.42 area is the strongest magnetic zone nearby. The $0.3 area is also interesting. Further bearishness in Bitcoin could lead to Dogecoin dropping to the liquidity pool at $0.3.
These liquidity pockets are key support/resistance zones that could trigger short-term price reversals. In higher time frames like the daily, DOGE's market structure is bullish, but the $0.37 area is an important and fiercely contested domain.
