Dogecoin’s open interest has crashed over $3 billion since January, sparking a bearish sentiment for the foremost meme coin. This critical metric is still at risk of crashing further, given the current outlook in the broader crypto market.
Dogecoin’s Open Interest Crashes Over $3 Billion Since January
Coinglass data shows that Dogecoin’s open interest has crashed over $3 billion since January and currently stands at $1.91 billion. The derivatives volume has also declined by almost 30% and currently stands at $3.71 billion. This development is bearish for DOGE as it indicates a declining interest in its ecosystem among traders.
Dogecoin’s open interest is likely to crash further in the meantime, given the bearish sentiment among investors. This bearish sentiment has resulted from the downtrend in the crypto market, which has also led to a massive crash in the Dogecoin price. The foremost meme coin is currently at risk of losing the $0.2 psychological price level, which analysts like Ali Martinez have warned could mark the end of its bull run.
Beyond the crash in Dogecoin’s open interest, other metrics paint a bearish picture for Dogecoin and suggest that the decline could continue. In an X post, Martinez revealed that DOGE’s network activity has significantly contracted, with new address creation dropping from 1.29 million in November to just 30,815 today.
Similarly, DOGE’s active addresses have dropped from 2.66 million in November last year to around 130,282 today. Meanwhile, DOGE’s whales are choosing to remain on the sidelines amid this downtrend. Their absence could also contribute to a further downtrend, given their usual impact on the meme coin’s price.
The $1 Target Still In Play Despite Downtrend
Crypto analyst Trader Tardigrade suggested that the Dogecoin price can still rally to the much-anticipated $1 target despite this market downtrend. In an X post, he revealed that the foremost meme coin is following the same pattern as the 2017 bull run. In line with this, he asserted that DOGE is ready for the next surge.
The analyst’s accompanying chart showed that the Dogecoin price could rally above $1.7 when this next surge occurs. Crypto analyst DOGECAPITAL stated that DOGE will move towards $1.7 when this consolidation phase is complete. He remarked that this move would mirror previous cycles where the meme coin hit the same parallel level of resistance.
Meanwhile, the analyst is still convinced that the Dogecoin price could eventually rally to as high as $10 in this market cycle. This is based on a parallel channel which he suggested is mirroring the 2017 and 2021 bull cycles.
At the time of writing, the DOGE price is trading at around $0.2, down almost 2% in the last 24 hours, according to data from CoinMarketCap.
Featured image from iStock, chart from Tradingview.com
