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▲ Dogecoin (DOGE)/ChatGPT generated image ©
As Dogecoin (DOGE) tests a key support level at $0.070, long bets in the derivatives market have increased to their highest level in a month, and a bullish divergence has appeared, suggesting a potential weakening of selling pressure.
According to investment media FXStreet on August 4 (local time), Dogecoin stabilized around $0.070 on Tuesday after falling 3.5% last week. Although the overall trend remains bearish, derivatives indicators and improving momentum suggest a potential price recovery.
According to Coinglass, Dogecoin's long/short ratio reached 1.25, its highest in the past month. A ratio above 1 means more investors are betting on a price increase. The funding rate also turned positive on July 24 and recorded 0.0074% on the day. This structure, where long position holders pay costs to short position holders, indicates a bullish sentiment in the derivatives market.
Technically, Dogecoin remains in a short-term bearish structure, trading below the 50-day exponential moving average of $0.075, the 100-day line of $0.083, and the 200-day line of $0.100. However, unlike the price forming a lower low on August 1, the daily Relative Strength Index (RSI) recorded a higher low, indicating a bullish divergence. The Awesome Oscillator (AO) also supported the weakening downward momentum, with its low rising while the price remained near its low.
In case of a decline, $0.070 is the first support level, and if it breaks, it could test the year's low of $0.067. If trading closes below $0.067, it opens up the possibility of a further decline to the psychological support level of $0.065.
For a rebound, Dogecoin must first recover the 50-day line at $0.075, then break through the downtrend line at $0.080 and the 100-day line at $0.083. After that, $0.088, the 200-day line at $0.100, and the key resistance level at $0.102 await. Reclaiming these price levels could alleviate the existing bearish outlook.
*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.*
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