While Dogecoin price is trading slightly lower at $0.25 at the time of writing, one analyst thinks the price risks potentially losing critical support should the price fall from the ascending channel traded over the past 53 days.
Is Dogecoin (DOGE) in danger of falling?
According to analyst Marcel Pechman cryptocoin.com As we also reported, Binance’s restriction on DOGE withdrawals could be behind the recent price weakness that caused DOGE to drop as low as $0.25. Still, the analyst points out that derivatives markets, where Dogecoin open positions are facing significant resistance, may also have played a role in this decline.
Unlike volume data, open interest provides a better picture of investors’ total risk exposure. Regardless of trading activity, which can be momentarily interrupted after strong price movements, the open position will remain high as long as players hold their positions. “Notice how the previous four attempts to break the $1 billion futures open interest mark have resulted in significant price corrections,” Pechman said. “Currently, the indicator stands at $850 million, so it looks like the near risk has passed.”
However, he points out that observing a 17 percent positive price move towards $0.30 could potentially push the DOGE derivatives metric back into the dreaded $1 billion open interest. It also points to the possibility of investors reopening leverage positions and inflating open positions regardless of price change.
Contact us to be instantly informed about the last minute developments. twitter‘in, Facebookin and InstagramFollow and Telegram and YouTube join our channel!
Disclaimer: The articles and articles on Kriptokoin.com do not constitute investment advice. Cryptokoin.com does not recommend buying or selling any cryptocurrencies or digital assets, nor is Kriptokoin.com an investment advisor. For this reason, Kriptokoin.com and the authors of the articles on the site cannot be held responsible for your investment decisions. Readers should do their own research before taking any action regarding the company, asset or service in this article.
Warning: Citing the news content of Kriptokoin.com and quoting by giving a link is subject to the permission of Kriptokoin.com. No content on the site can be copied, reproduced or published on any platform without permission. Legal action will be taken against those who use the code, design, text, graphics and all other content of Kriptokoin.com in violation of intellectual property law and relevant legislation.