While Elon Musk’s latest interaction with a Dogecoin-related post drew attention, traders were more focused on a rare series of weekly buy signals that have yet to translate into price strength.
It was the first Dogecoin [DOGE]-related memecoin the billionaire has liked since the biggest memecoin, DOGE itself, Whale Insider reported on X.
Technical analyst Ali Martinez also showed that the memecoin had generated a buy signal on the weekly timeframe. The TD Sequential indicator has flashed consecutive buy signals, “a rare setup that could be warning a major bull rally is approaching”, the analyst wrote on X.
Yet, the price movement of DOGE in recent days has been lacking. In the past 24 hours, its daily trading volume has slid by 20%, and the memecoin was flat for the day and down 0.94% over the past week. Its Open Interest had not budged, either, dropping only 1.1% in a day.
Long-term DOGE bulls’ hopes are draining away
Source: DOGE/USDT on TradingView
After dropping to the $0.088 support zone in February, the bulls fought valiantly to defend it. In May, a recovery appeared to be underway. At the same time, Bitcoin [BTC] faced rejection from its rally to $82.5k, dragging the rest of the crypto market downward.
Source: CryptoQuant
The spot taker CVD of the past three months showed that from December to late March, taker buy volumes dominated spot markets. For a few days in May, taker buy volume spiked, as Dogecoin prices tried to push beyond the $0.12 resistance zone.
The optimism has drained away since then. Taker sell dominance was not yet underway, but DOGE itself was trading 17% below the $0.088 former support level.
What to expect from Dogecoin for now
A week ago, AMBCrypto had reported that the liquidation map made a case for a short squeeze toward $0.08. This scenario has not yet played out.
Source: DOGE/USDT on TradingView
The swing structure was firmly bearish. Technically, a bounce toward $0.083-$0.087, the Fibonacci golden pocket, remains possible. In the lower timeframes, the $0.075 area was a key resistance zone too.
Traders can wait for a move toward the local highs at $0.078 to begin to sell, or for a test of the golden pocket, too. Bitcoin needs to clear the $67.2k area to signal that it is ready to rally as high as $77k.
If BTC clears this resistance, a short-term market-wide bullish sentiment shift could see a Dogecoin bounce. If BTC faces a drop below $62.5k, the leading memecoin would be much more likely to fall to new swing lows without a meaningful bounce.
Final Summary
- Dogecoin’s lack of volatility in recent days meant that the short squeeze idea was not yet invalidated.
- Traders will need to keep an eye on Bitcoin trends to gauge if the memecoin would have the potential to rally or would head toward new swing lows next.
