Dogecoin's Death Cross: Bearish Outlook Looms

Dogecoin, the popular memecoin, has been facing mixed market conditions over the past week, with its daily and monthly performance diverging from its positive weekly performance. At press time, Dogecoin (DOGE) was trading at $0.2608, down approximately 34.2% over the last day. This latest decline added to the asset's ongoing struggle to recover its all-time high of $0.7316, recorded in 2021. Currently, Dogecoin's market price stands roughly 64% below that peak.

Amid these challenges, analyst Ali Martinez has offered a bearish outlook on DOGE. He observed that the memecoin recently experienced a "death cross" involving the MVRV ratio and its 200-day moving average. A death cross generally occurs when a shorter-term moving average crosses below a longer-term moving average, signaling potential further downside. In this case, Ali noted that during the last two instances of this pattern, Dogecoin's price dropped by 26% and 44%, respectively. The MVRV ratio, which evaluates how much profit or loss holders have realized on average, offers insights into market sentiment. Ali's analysis suggests that DOGE could be positioned for additional declines unless key resistance levels are broken.

In addition to the death cross, Ali pointed out that Dogecoin's trend of lower highs and lower lows remains intact. This downtrend indicates that momentum has yet to shift in favor of the bulls. Furthermore, he highlighted that whale activity on the DOGE network—transactions involving large holders—has declined by nearly 88% since mid-November. A drop in whale activity often signifies reduced interest from major investors, potentially diminishing buying support at critical levels.

Dogecoin's Open Interest has also shown a downward trend. Data revealed a 3.79% decline in OI over the past day, with the press time valuation standing at $2.45 billion. Open Interest volume has similarly dropped by 5.52% during the same timeframe, now at $2.39 billion. A decline in Open Interest generally reflects a decrease in the number of active derivative contracts in the market, which can indicate waning trading enthusiasm or reduced speculative activity. This could mean that traders are less willing to commit significant capital to DOGE's short-term price movements, further contributing