Despite Dogecoin [DOGE] bouncing off the $0.06 support again, the intense selling pressure could see the support level broken by bears. This level has been critical for bulls over a month-long period, with buyers standing firm to resist the bearish advance.
Even though the wider crypto market was green with Bitcoin [BTC] trading above $27.5k, DOGE bears could break the bullish resilience at the $0.06 support in the short term.
Can bears flip support level on the fourth attempt?
Support and resistance levels are established price zones with a lot of buy and sell orders. They usually serve as critical levels to watch out for during a bullish rally or a bearish downtrend.
The $0.06 support level has been a stronghold for buyers since early June. Despite DOGE’s bearish price action since late July, the support level has held firm to limit the bearish downtrend.
However, the recent multiple retests of the support level highlighted the weakening structure, with bears poised to take advantage. The Relative Strength Index (RSI) dipped under the neutral 50 to underline the selling pressure in recent hours.
Similarly, the On Balance Volume (OBV), which had been on an uptrend in October, showed a drop in trading volume.
Hence, sellers could break below $0.06 with a near-term target of $0.055. Alternatively, if buyers hold the support level again, $0.064 to $0.067 will be the short-term target for bulls.
Sellers leveraged the selling pressure by taking up more short positions in the futures market. As of press time, short positions worth $46.04 million accounted for a 52.02% share of the open contracts.
As a result, buyers have experienced more liquidations over the past day.
This highlighted the willingness of market participants to ride DOGE down to sub $0.06 prices in the short term.