DOGE has held the $0.060 level, but the recovery has been slow.
DOGE’s open interest rate has fluctuated over the past four weeks. Dogecoin stabilizes at $0.060, but selling pressure remains
Despite the recent recovery, Dogecoin [DOGE] is still facing significant selling pressure at press time. As of writing, the Meme coin is trading at $0.0622, up about 4% from its recent low of $0.059.
However, unless next week’s FOMC meeting injects positive momentum, demand volatility and increased short positions could derail the recovery.
Here are the key target levels for Dogecoin
The Fibonacci retracement tool (yellow) is plotted between the July high of $0.0838 and the June low of $0.0530. According to the tool, bulls have consistently held onto the 23.6% Fib level of $0.0603 in June, August, and September.
Between mid-August and mid-September, DOGE experienced a combined loss above the 23.6% Fib level ($0.060). In late August, a false breakout above the 50% Fib level ($0.068) led to a pullback to $0.060.
Therefore, if the Fed’s September 20 decision is dovish, DOGE could target the 38.2% Fib level ($0.0648) or the 50% Fib level ($0.0684). Such an uptick could even push DOGE towards the barrier around $0.075 (white), especially if Bitcoin [BTC] rebounds above $28,000.
However, a decline and daily close below the 23.6% Fibonacci level ($0.0603) will weaken the market structure. In this case, a depreciation to $0.0556 might be feasible.
Meanwhile, capital inflows into DOGE markets have declined, as indicated by the Chaikin Money Flow (CMF) moving south. Additionally, the Relative Strength Index (RSI) has been in a low range since mid-August, exacerbating the selling pressure of the past four weeks.
Short positions increase as demand falters
The futures market data confirms the bearish pressure in the spot market. In these three days, more players are shorting DOGE. This means that they expect further declines in the future.
Additionally, Binance Futures data shows that DOGE open interest has fluctuated above $74 million over the past four weeks (since mid-August). This suggests that demand for DOGE is stagnant, which could extend the price consolidation above $0.060.
However, the FOMC meeting will spark volatility, with the 38.2% and 50% Fib levels being key targets to consider.
