to leave a comment.
▲ Dogecoin (DOGE)
Bullish bets in the Dogecoin (Dogecoin, DOGE) derivatives market have entered an overheated zone.
According to U.Today, a cryptocurrency specialized media outlet, on July 29 (local time), the long-to-short account ratio for Dogecoin among top traders on Binance recorded 3.25. On OKX, this ratio exceeded 3.6. The ratio for all Binance accounts also surpassed 2.6. Both professional and retail investors are betting on price increases, leading to a significant bullish tilt in positions.
Price indicators contradict the optimism in the derivatives market. Dogecoin is trading below its 20-day exponential moving average (EMA) of $0.073 and its 50-day EMA of $0.076. The 100-day EMA is at $0.085, and the 200-day EMA is above $0.10. The arrangement of key moving averages indicates an ongoing general downtrend.
With the price remaining at a low level and long positions excessively increasing, the risk of cascading liquidations has grown. If the $0.070 support level breaks, leveraged long positions could be forcibly closed. If liquidation volumes hit the market, selling pressure could intensify, accelerating the downward trend.
Trading activity on Binance, OKX, and Bybit is robust, but derivatives trading volume has decreased compared to previous weeks. This suggests that the conviction behind new bullish bets is not as strong as the long-short ratio indicates. After a sharp drop in June, Dogecoin largely traded sideways above the $0.070 support level for most of July.
The Relative Strength Index (RSI) recorded 41. While selling pressure has decreased, no clear buying momentum has emerged. To strengthen an upward trend, Dogecoin needs to recover $0.073 and then surpass $0.076. Conversely, if $0.070 breaks, the potential for further selling and approaching annual lows increases. Investor positions, skewed bullish despite the price, are identified as a key risk signal.
[Article Key Summary]
-The Dogecoin long-to-short ratio for top traders on Binance is 3.25, and it exceeded 3.6 on OKX.
-Dogecoin is trading below key moving averages, and derivatives trading volume has decreased.
-If the $0.070 support level breaks, the risk of cascading liquidations for long positions and further decline increases.
*Disclaimer: This article is for investment reference only, and we are not responsible for any investment losses based on it. The content should be interpreted for informational purposes only.*
Newsletter
Get key news delivered to your email every morning
to leave a comment.