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- Retracement below 78.6% means that Dogecoin can be traded within a range
- Long positions have been blown up in droves in December, so bulls need to be careful
Bitcoin had a few quiet days as volatility faded over the weekend. He could be back with a vengeance on Monday. Stock indices like the S&P 500 have been bearish for the past week and December 19 could set the trend for the week ahead.
Read Dogecoins [DOGE] Price forecast 2023-24
Dogecoin fell back to the $0.072 support area and saw a 4% retracement over the past two days, but open interest was weak. However, it is still facing resistance at $0.08, a level that has been important over the past month. Can bulls regain this level and height?
The bullish command block keeps Dogecoin going, but this may be nothing more than a pause
Based on the move in late November from $0.071 to $0.119, a set of Fibonacci retracement levels (yellow) were drawn. At the time of writing, the price has fallen below the 78.6% retracement level. It encountered a bullish order block, highlighted in cyan, above the $0.072 support level.
An almost full recovery means that Dogecoin was most likely trading in a range rather than a strong trend. The Relative Strength Index (RSI) has swung from a strong bullish momentum to a strong bearish momentum even though the DOGE has not shown a long-term trend since mid-November. On Balance Volume (OBV) also fell below the support level in late November.
Together, they suggested that the sellers were in control. A daily session closing below $0.071 is likely to start DOGE’s decline. However, brave bulls may look to bid on the asset within this region.
The $0.8 level turned into support before a rally to $0.119 two weeks ago. As a horizontal level as well as a Fibonacci retracement level, it was of importance. A retest of support in the coming days may provide a buying opportunity. The profit-taking targets will be the break-down at $0.091 and $0.11. Below $0.072 is the next level of support at $0.065.
Open interest increased slightly over the weekend and the funding rate remained positive
Since the beginning of December, Dogecoin has seen a session with a sharp price drop. This was accompanied by the liquidation of long positions worth millions of dollars. During the drop from $0.119 on December 5th to $0.075 on December 16th, open interest also saw a decline.
This indicates that long positions are not encouraged. The funding rate remained in the positive territory, which also showed that the majority of the market did not start selling.