After a brief display of bullish momentum on Thursday, Dogecoin began its bearish price action, falling as low as $0.201. In 1 month, DOGE’s price has declined by almost 40%, triggering speculations about a possible bear market phase. However, the dog-themed meme coin could still experience a rebound as it moves into a key zone.
Order Block Zone Hints At An Uptrend For Dogecoin
Dogecoin has been facing bearish pressure, causing its price to retest previous support levels. Meanwhile, market expert and investor Trader Tardigrade has revealed a bullish trend in DOGE’s recent price action.
Delving into Dogecoin’s price action, Trader Tardigrader highlighted that the meme coin has entered a crucial order block zone for substantial buying or selling activity that may determine the stock’s future trajectory. Order block zones during heightened volatility often serve as strong support or resistance levels.
Many large concentrations of limit orders are currently waiting to be executed in this zone. When this zone is filled with orders, Trader Tardigrade is confident that DOGE will move to the upside in the upcoming weeks.
The experts anticipate an uptrend for DOGE since past scenarios preceded significant rallies in the following weeks, as seen on the daily chart. Should buying pressure increase as DOGE trades within this order block zone, this could ignite bullish momentum, allowing it to reclaim key resistance levels and possibly a new all-time high.
A key pattern cited in the 4-hour time frame chart is further backing DOGE’s potential for an uptrend. In another X post, Trader Tardigrade noted that the meme coin has formed a Double Bottom chart pattern, an indicator that usually signals an upward trend.
If Dogecoin effectively performs the bottoming chart formation, it is expected to resume its upward movement. Looking at the expert’s chart, the pattern could cause a rebound to the $0.22 level in the following days.
While the double bottom hints at growing momentum, DOGE’s Relative Strength Index (RSI) has undergone a bullish breakout from a horizontal resistance line. This breakout is likely to support the meme coin‘s anticipated price recovery triggered by the bottoming pattern.
DOGE Open Interest Tanks In The Past Months
Dogecoin’s Open Interest (OI) has declined sharply along with its waning price movements. Technical expert Ali Martinez reported an over 67% decrease in DOGE’s open interest over the past 3 months. This represents a drop from its all-time high of $4.07 billion in December to about $1.33 billion today.
Surprisingly, investors are beginning to demonstrate interest in DOGE amid the current price drop. On-chain data shows that large investors or whales have returned to the market, heavily acquiring Dogecoin. These whales have accumulated more than 530 million DOGE in the past 72 hours, signaling confidence in its long-term prospects.
Featured image from Shutterstock, chart from Tradingview.com
