Dogecoin (DOGE) faces downside risk: technical analysis reveals key support levels

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On December 26, as major cryptocurrencies such as Bitcoin (BTC), Ethereum (ETH) and XRP generally fell, Dogecoin (DOGE) was not spared, and the overall market sentiment was bearish.

DOGE price faces major support test

According to technical analysis, DOGE is currently in a small consolidation zone, and has failed to hold the $0.35 support level and recently hit the $0.30 floor. If DOGE cannot maintain above this support level and closes below $0.30 on the daily line, it may fall further, with a target price of $0.22, a drop of 25%.

Bearish sentiment intensifies

Market sentiment indicators also support the bearish view. Coinglass data shows that DOGE's long/short ratio is 0.71, a new low since early December 2024. A ratio below 1 indicates that traders are generally bearish, with 58.3% of top DOGE traders holding short positions.

No selling by long-term holders

Despite the overall bearish market sentiment, long-term holders appear to be accumulating DOGE from exchanges, with a total outflow of $32.75 million in DOGE recently, which is seen as a possible buying opportunity and a sign of a possible rebound in the future.

Declining market participation

The price of DOGE has fallen by more than 6.89% in the past 24 hours, and trading volume has fallen by 13%, showing that investors are concerned about falling prices, leading to reduced market participation.

Overall, DOGE may face downward pressure in the short term, with the key support level at $0.30, which could lead to a larger decline if broken. However, the accumulation behavior of long-term holders also suggests that there may still be rebound opportunities in the future.

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