Dogecoin [DOGE] continued to bleed as the broader cryptocurrency market sought footing following last week’s volatility. Bitcoin [BTC], which has shaped a familiar price rhythm since May 23—plunging sharply on Thursdays or Fridays, ranging through the weekend, and recovering on Mondays—once again hinted at a potential rebound. Yet, at press time, DOGE’s technical and on-chain indicators painted a less convincing picture.
The popular memecoin has faced a series of lower highs and lower lows on the daily chart, confirming a bearish market structure. DOGE was trading beneath the 78.6% Fibonacci retracement level, which was drawn from its early May rally. This retracement zone has historically acted as a critical support level, but price action suggests it could break further down before any potential recovery.
A significant liquidity pocket lies at $0.17—DOGE’s local low. With sellers maintaining control, there is a growing possibility that Dogecoin will revisit this level in the short term. Technical traders and swing investors are watching this zone closely for a potential bounce or further breakdown.
While the price action remains bearish, some on-chain metrics offer glimmers of hope for long-term investors.
According to Glassnode, the Network Value to Transactions Signal (NVTS)—a refined version of the NVT ratio using a 90-day moving average—has dropped below its May–June levels. This typically suggests that the asset is undervalued in terms of its network utility. Historically, such dips in NVTS have been associated with potential buying opportunities, as the market may be undervaluing DOGE’s on-chain activity.
Further supporting this notion is the Exchange Net Position Change metric, which turned negative in early June. This trend implies more DOGE is leaving exchanges than entering, often interpreted as a sign of accumulation. Investors moving DOGE into private wallets could indicate long-term confidence in the asset.
However, caution remains critical. A similar pattern of negative exchange flows occurred in January 2024, but instead of a rally, DOGE trended downward for three consecutive months. Seller dominance is further confirmed by the On-Balance Volume (OBV) indicator, which continues to trend downward, reflecting sustained sell-side pressure.
In the short term, traders should brace for further volatility and the potential for DOGE to test the $0.17 level again. If this zone fails to hold, it could open the door for steeper declines. Conversely, a strong bounce from this area could signal the beginning of a recovery phase.
Also Read: Dogecoin Rises 3% but Retail Traders Stay Away
For investors, the current undervaluation presents a potential entry point—but only for those with a long-term horizon and a tolerance for risk. Dollar-cost averaging (DCA) remains a prudent strategy in such uncertain conditions, allowing investors to build positions gradually without overexposure to near-term price swings.
Disclaimer: The information in this article is for general purposes only and does not constitute financial advice. The author’s views are personal and may not reflect the views of CoinBrief.io. Before making any investment decisions, you should always conduct your own research. Coin Brief is not responsible for any financial losses.
