Dogecoin (DOGE) price is facing a downtrend that has lasted for more than five months, with the meme coin struggling to break out of this situation. Recent price movements suggest that a breakout of DOGE may not happen in the near future.

This comes as market indicators are signaling potential overvaluation, threatening DOGE’s bullish hopes.

Dogecoin Faces Great Responsibility

The Global In/Out of the Money (GIOM) Index shows significant resistance at $0.108. This area is important as over 48.3 billion DOGE, worth over $5.2 billion, was purchased between $0.104 and $0.137. Investors holding in this range are likely to sell on signs of profit taking, creating a thick wall of supply that could hinder the upside.

With such resistance, DOGE needs strong support from the broader market to break above $0.108. Until then, supply pressure could weigh down the price, preventing the meme coin from achieving a meaningful breakout above this level.

Additionally, the Network Value to Transactions (NVT) ratio has been rising since early August, suggesting that Dogecoin may be overvalued. This metric compares an asset's market capitalization to its transaction volume, and a rising ratio suggests that valuation is outpacing network activity.

This trend is worrying for Dogecoin, as it often leads to corrections. The overvaluation, combined with low trading volume, often signals that a price drop may be imminent.

DOGE Price Prediction: Keep Moving

Currently, Dogecoin is trading around $0.104 and faces a dual challenge: breaking out of a five-month-long downtrend while overcoming resistance at $0.108. Given the signals from the broader market, this could be a difficult task in the short term.

The possibility of accumulation below $0.108 remains high. This is because the signals from the market are not strong enough to spur a significant price increase. DOGE is likely to remain in the range of $0.108 to $0.091 in the near term.

However, if broader market conditions improve and investors hold their positions instead of selling, Dogecoin could break above $0.108. Such a breakout would open the door for a 16% rally towards $0.122, potentially invalidating the bearish forecast.

DYOR! #Write2Win #Write&Earn #Write2Learn #Write2Earn!