Dogecoin Price at Risk of 40% Drop as Futures Demand Slumps
Dogecoin price has fallen 55% from its November peak and continues to trade in a technical bear market. Futures open interest for DOGE has dropped nearly 40% since July, indicating waning derivatives demand and liquidity. Derivatives trading volume also fell to $4.7 billion from $14.5 billion last month. On the three-day chart, DOGE has formed a bearish pennant (symmetrical triangle) pattern at the 61.8% Fibonacci retracement level near the 50-day and 100-day EMAs. A breakdown below the triangle could send Dogecoin price toward its year-to-date low of $0.1362, a 40% decline from current levels. A move above the pennant’s upper trendline would invalidate this bearish forecast.
Bearish
Derivatives data show a 40% drop in DOGE futures open interest and a two-thirds decline in trading volume, signaling weak demand and liquidity. The formation of a bearish pennant on the three-day chart, following a 55% fall from November highs, aligns with classical technical analysis where pennant breakdowns lead to accelerated declines. Comparable setups in Bitcoin and other altcoins have resulted in sharp corrections when open interest waned. In the short term, reduced derivatives activity and technical resistance around the 61.8% Fibonacci retracement and EMAs could trigger a move toward the $0.1362 YTD low. Without a significant catalyst, Dogecoin may remain in a downtrend until demand recovers, making this news clearly bearish for traders.