After hitting a peak of $0.149 on October 21st, Dogecoin [DOGE] has recorded an 8.05% decrease. Currently, Dogecoin is trading at $0.137, reflecting a 2.59% increase over the past week and a 26.61% gain on a monthly basis.
Although the overall monthly trend remains positive, there are signs that the upward movement is losing steam. In early October, DOGE surged from $0.102 to $0.149, a significant 46.05% jump.
However, recent price actions suggest a shift in momentum as sellers appear to be taking control of the market sentiment.
A significant bearish signal emerged in the form of a crossover. The Directional Movement Index shows that the negative (-DI) line has crossed above the positive (+DI) line. As of now, -DI is at 32, surpassing +DI at 29 after a decrease in +DI over the last day.
This crossover indicates a strengthening downtrend, with the Average Directional Index (ADX) rising from 17 to 32 within a week.
With this DMI configuration, it indicates that selling pressure is intensifying and sellers are gaining dominance over buyers. If this pattern continues, Dogecoin could enter a sustained downtrend phase.
Interpreting Dogecoin’s Charts
The prevailing bearish sentiment is further supported by an increase in short positions by investors. Data from Coinglass indicates that 52.35% of investors have opted for short positions in the last 24 hours.
This suggests that a majority of investors are expecting a decline in DOGE’s price in the short term.
Furthermore, Dogecoin’s Price DAA divergence has remained negative, indicating a weakening bullish momentum over the past week. This implies a reduction in market participation.
The recent price surge is largely fueled by speculative trading rather than strong fundamental factors, often preceding a price correction.
There is a noticeable shift in momentum for Dogecoin, with bullish momentum losing strength. If the current market conditions persist, DOGE is likely to undergo a correction, finding support around $0.12 in the near future.