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Dogecoin continues to face significant selling pressure despite a recent Bitcoin rally, signaling cautious sentiment among investors.
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The memecoin’s price action remains bearish, with key technical indicators and on-chain metrics pointing to a distribution phase and low bullish confidence.
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According to COINOTAG sources, the negative 180-day MVRV ratio combined with persistent selling from newer holders underscores the challenges Dogecoin faces in regaining momentum.
Dogecoin’s bearish trend persists amid Bitcoin’s gains, with distribution phases and negative MVRV signaling low investor confidence in the memecoin’s short-term recovery.
Dogecoin’s Bearish Momentum Persists Despite Bitcoin’s Rally
Dogecoin [DOGE] has struggled to break past its critical resistance level of $0.2, retreating to lows near $0.17 following last week’s rejection. While Bitcoin’s recent surge above $106,000 has sparked optimism across the crypto market, Dogecoin’s price action remains overshadowed by bearish technical signals. The TD Sequential indicator on the 12-hour chart has flashed multiple buy signals, yet the broader high-timeframe (HTF) trend continues to favor sellers. This divergence highlights the difficulty DOGE faces in mounting a sustained recovery.
On-chain metrics further reinforce this bearish outlook. The On-Balance Volume (OBV) shows heightened selling pressure, and the Relative Strength Index (RSI) remains in bearish territory, indicating weak momentum. These factors collectively suggest that a breakout above the $0.2 resistance will require significant buying interest, which has yet to materialize.
Distribution Phase and On-Chain Activity Signal Weak Investor Confidence
Analysis of Dogecoin holders, particularly those who have held their tokens for less than six months, reveals a clear distribution phase. The mean coin age — representing the average holding period of DOGE tokens — has been declining steadily for over five weeks, implying that newer holders are offloading their positions. This trend is corroborated by spikes in dormant circulation, indicating increased on-chain transfers likely linked to selling activity.
Moreover, the 180-day Market Value to Realized Value (MVRV) ratio remains negative, a metric often interpreted as a sign of undervaluation but also reflecting a lack of bullish conviction among investors. This combination of distribution and negative MVRV suggests that despite short-term technical buy signals, the broader market sentiment remains cautious, with many investors reluctant to commit long positions in DOGE at current levels.
Market Sentiment and Macroeconomic Factors Impacting Dogecoin
The broader macroeconomic environment continues to weigh heavily on risk assets, including cryptocurrencies like Dogecoin. Ongoing geopolitical tensions in the Middle East and persistent economic uncertainties have dampened investor appetite for speculative assets. While Bitcoin’s recent rally has provided some relief, the memecoin market has not mirrored this optimism uniformly.
A recent COINOTAG report highlighted that approximately 70% of altcoins are experiencing a long bias in the perpetuals market, with large-cap assets seeing around 60% of traders leaning long. However, Dogecoin’s persistent bearish indicators suggest that traders and investors remain divided on its near-term prospects. The memecoin’s unique market dynamics, driven in part by retail investor behavior and social sentiment, contribute to this cautious stance.
Technical Barriers and Investor Caution Ahead
Dogecoin faces significant technical hurdles that could impede a sustained rally. The $0.2 resistance level has proven formidable, with multiple failed attempts to breach it. Additionally, the bearish momentum reflected in the RSI and OBV metrics signals ongoing selling pressure. Investors should note that while short-term bounce opportunities may arise, the overall trend remains bearish until these technical barriers are convincingly overcome.
Traders considering long positions might be encouraged by Bitcoin’s strength and the TD Sequential buy signals, but a prudent approach is warranted given the distribution phase and negative MVRV ratio. Monitoring on-chain activity and broader market sentiment will be crucial for assessing Dogecoin’s potential recovery trajectory.
Conclusion
Dogecoin’s current market dynamics reflect a complex interplay of technical resistance, on-chain distribution, and macroeconomic headwinds. Despite Bitcoin’s recent rally and some short-term bullish signals, the memecoin remains in a bearish phase characterized by selling pressure and low investor confidence. For investors and traders, a cautious stance is advisable, with close attention to key resistance levels and on-chain metrics to gauge any shift in momentum. Dogecoin’s path to recovery will likely depend on broader market conditions and renewed buying interest overcoming entrenched selling pressure.
