Over the past month, Dogecoin (DOGE) has seen significant growth on the price chart, increasing by 13.66%. Accordingly, the memecoin has risen from a low of $0.088 to a high of $0.132.
However, at the time of writing, Dogecoin is trading at $0.108, which marks an 11,422% drop on weekly charts.
Recent price movements raise the question of whether Dogecoin will recover and continue its uptrend for the month or whether bears will take over the market.
Therefore, popular crypto analysts Ali Martinez and Kevin have pointed out the necessary conditions for the next sustainable uptrend.
What does market sentiment sayâŠ
In his analysis, Kevin argued that current market conditions suggest that bearish sentiment is prevailing.
According to the analyst, DOGE has broken out of a macro falling wedge pattern, a bearish signal. Furthermore, the memecoin has lost all important Moving Averages (MA) on the 1-day and 4-hour timeframes, another bearish signal.
Therefore, the analyst argues that Dogecoin revisits $0.08 and finds a new support level before attempting the next bullish reversal.
In contrast, Martinez cited the example of 60,210 addresses holding 36.40 billion DOGE at a price of $0.11.
According to this analysis, DOGE needs to reclaim the $0.11 resistance level to maintain its bullish outlook. If memecoin fails to do so, it will lead to a major sell-off as investors look to cut their losses.
Typically, such a large sell-off would lead to a deeper price drop and prolong the downtrend, as has been seen over the past week.
What does the DOGE chart suggest?
Certainly, the analysis provided by Martinez and Kelvin paints a bearish outlook. But what do other indicators say?
First, Dogecoin Open Interest per exchange decreased last week from $224 million to $129.6 million.
This decline indicates that investors are closing their positions without new entrants, thus signaling a bearish market sentiment.
Additionally, Dogecoin's price DAA divergence turned negative three days ago. The negative DAA divergence indicates that fewer users are interacting with the DOGE ecosystem.
Therefore, the recent rally is not entirely based on fundamentals but rather on speculation.
Finally, Dogecoin's daily active addresses over the past four days have dropped from 144,800 to 74,700.
The decline in active users indicates a decrease in demand or interest in memecoin.
In other words, while DOGE has staged a modest recovery on the daily chart, weekly losses are still more than recent gains.
So, if the current sentiment continues, can DOGE hold the next support level at $0.098? If there is a reversal, Dogecoin will reclaim the $0.011105 level.
