Emily Walker
More than half of the traders are currently engaging in short positions on DOGE as the cryptocurrency faces significant price drops due to market fluctuations. Although there was a brief recovery, Dogecoin still exhibits a downward trend.
Traders Bet Against DOGE Amid Price Drops
Recently, Dogecoin’s value plummeted, decreasing by over 25% within a day. This steep fall has incited widespread concern in the crypto realm, prompting many investors to exit the market and liquidate their assets.
As pointed out by crypto analyst KrissPax on X (formerly Twitter), the trend of selling Dogecoin has continued for four days as investors look to maximize profits from previous gains while sidestepping potential losses. Each time the price falls, it drives the value closer to the $0.24 mark.
The analyst noted that Dogecoin has not been able to maintain any solid support level, continually losing value on a day-to-day basis. Given this downward trend, there’s speculation on whether the coin is nearing a market bottom that could lead to a price reversal.
In contrast to this optimistic outlook, Coinglass data shows that 51.29% of traders are betting on additional price drops for Dogecoin. This reflects a prevailing skepticism towards its short-term recovery potential.
While some traders anticipated stabilization or a rebound to higher levels, DOGE continues to show weak market dynamics. Coinglass reports that 48% of traders still believe in Dogecoin’s potential to bounce back and initiate another price surge.
At this moment, the selling pressure on DOGE has raised alarms within the crypto community. Many advise that investors should view the recent downturn as a buying opportunity and hold their investments long-term to discourage larger investors, or “whales,” from accumulating more assets.
While retail investors are offloading their DOGE tokens, larger investors are doing the opposite by actively purchasing more despite the current decline. These sizable players are seizing the chance to increase their DOGE portfolio, betting on future price recoveries.
Analyst Indicates Need for $0.25 Breakthrough in DOGE
In discussing the recent downturn of Dogecoin, an analyst known as ‘AlgoXTrading’ on X highlighted two significant price levels that could lead to a favorable change for the cryptocurrency. He noted that maintaining the $0.19 support level is essential for a potential price reversal.
Moreover, he suggested a possible upward breakthrough at the $0.25 mark, asserting that moving past this threshold is critical for DOGE to regain positive momentum. The analyst expressed confidence in Dogecoin’s future, citing influences such as Elon Musk that could potentially ignite a price rally, while also noting that historically, DOGE has “rebounded more strongly than anticipated.”