Dogecoin (DOGE) continues to sink in the red during Thursday's trading session, extending its decline after losing an additional 4% the day before. Selling pressure is increasing as the amount of profitable DOGE decreases significantly, amidst large wallets actively reducing their holdings. In the derivatives market, pessimism is increasingly prevailing, evidenced by the rise of short positions, while the inflow of funds from retail investors is gradually weakening. Technically, Dogecoin's outlook becomes less positive as the price breaks below the low established in April, opening up the risk of continuing to slide deeper towards the 0.1000 USD region.
Dogecoin weakens in on-chain and retail demand.
Data from Santiment shows that the group of investors holding between 100 million and 1 billion DOGE currently owns about 34.77 billion tokens, a significant decrease from the 36.14 billion DOGE recorded on December 1. Notably, on December 10, this group unloaded over 1 billion DOGE before most shifted to a relatively cautious trading state in the following days. Meanwhile, the percentage of profitable DOGE supply has also sharply declined, down to 50.70% from a peak of 53.95% on December 3, reflecting weakening market demand over time.
In the derivatives market, Dogecoin continues to face pressure as the entire cryptocurrency market enters a wait-and-see phase for important macroeconomic events, including the U.S. Consumer Price Index (CPI) data to be released on Thursday and the Bank of Japan's interest rate decision on Friday.
According to CoinGlass, the percentage of short positions in DOGE derivatives has increased to 53.91%, compared to 52.59% on Wednesday. The rise in short positions indicates that bears are clearly in control, which aligns with the fact that over $5 million worth of DOGE long positions have been liquidated in just the past 24 hours.
Technical outlook: Does DOGE have the potential to retest the $0.10 mark?
Dogecoin has extended its decline by more than 6% since the beginning of the week, approaching the Pivot Point S1 at $0.1231. This meme coin recorded its lowest daily closing price since October 17, 2024, amid a third consecutive week of decline.
If DOGE breaks below the $0.1231 mark, the downward momentum could extend to the psychological support area of $0.1000.
Reinforcing the downside risk, the MACD indicator continues to expand downward after crossing below the signal line on Monday. Meanwhile, the Relative Strength Index (RSI) is at 33 with a gradually descending slope, nearing the oversold threshold, indicating that selling pressure is very high.
However, if DOGE rebounds from the $0.1231 mark, the 50-day Exponential Moving Average (EMA) at $0.1556 could act as a resistance zone.