Bitcoin’s price has stabilized above $67,000, but traders are now focusing their attention on memecoins. The Open Interest of Dogecoin, in particular, has been decreasing, indicating a bearish sentiment. Since May 23rd, Bitcoin’s price has remained steady above $67,000, but traders are increasingly turning their attention to memecoins like Dogecoin (DOGE). This shift in focus comes as traders anticipate a potential supply overhang from the Mt Gox exchange.
Despite some gains in related tokens, the immediate outlook for Dogecoin remains uncertain. According to QCP Capital, a crypto-trading firm based in Singapore, traders have shown increased interest in high-beta meme tokens like Shiba Inu (SHIB), Dogecoin (DOGE), and Pepe (PEPE). These tokens have seen significant double-digit gains, ranging from 10% to 20%, and rank high in terms of Open Interest (OI).
A recent analysis by Coinalyze revealed that PEPE and FLOKI experienced significant rises in OI over the past 24 hours. However, Dogecoin’s OI has continued to decline, falling about 5% at the time of writing. This decrease suggests a bearish sentiment among traders and could delay a strong short-term recovery for DOGE.
Open Interest rates, which monitor the number of open futures contracts, are critical indicators of market sentiment. A rising OI typically signals bullish expectations, while a falling OI points to bearish sentiment. Since May 27th, Dogecoin’s OI has been trending downwards, dropping below $900 million. This decline highlights a lack of confidence in DOGE’s price potential among market participants.
Additionally, the Cumulative Volume Delta (CVD) for DOGE has been on a downtrend since May 27th, further indicating that sellers currently dominate the market. These indicators suggest that Dogecoin is facing significant selling pressure.
Dogecoin is currently trading at $0.16 with a slight 24-hour increase of 0.12%. This marks an impressive 185x increase from its all-time low of $0.0000869, according to CoinGecko data. DOGE recently experienced a slight correction, trading at 0.00000235 after falling from 0.0000255. Key support for this pair is provided by the 200-day Exponential Moving Average (EMA) and an ascending trendline.
On the resistance front, Dogecoin’s upward movement is limited by the confluence of the 20-day EMA and the 50-day EMA. The RSI (Relative Strength Index) is currently below the midline in the neutral zone, suggesting a bearish divergence.
Bitcoin, on the other hand, has struggled to establish a clear bullish trend. The cryptocurrency surged to $72,000 last week, driven by excitement over the approval of Ethereum ETFs. However, this was followed by a correction, and Bitcoin’s price settled at $68,723, reflecting a 0.8% increase over the past 24 hours. The market’s volatility and a lack of investor confidence have contributed to this correction.
The crypto market is expected to experience increased volatility as the US releases its inflation data on personal consumption expenditure (PCE). This data is crucial as it will provide insights into the Federal Reserve’s future moves on interest rates. Economists predict the first interest rate cut to occur in September, although some hope for an earlier cut in June. The Fed aims to bring US inflation down to the target rate of 2%, a goal that remains challenging.
Bitcoin’s ability to break out of its current stagnation and surpass $70,000 depends on these economic indicators. A successful breakout could trigger a fear of missing out (FOMO) among investors, potentially driving Bitcoin’s price towards $80,000.