As reported earlier, yesterday, December 9, the cryptocurrency market saw the highest leverage since April 2021. Amid market upheaval, Dogecoin (DOGE) is one of the altcoins that is showing significant signs of strength. In post on

Here’s Why Dogecoin Looks ‘Amazing’

Despite the market downturn, Dogecoin managed to maintain the most significant support level. CRG shared the table below and commented: “DOGE looks amazing. The entire market collapsed, but it barely flinched + didn’t break the structure. Now the funding has been completely reset and a lot of OI has been washed away. IMO it won’t be long before it becomes difficult again.”

The chart highlights several critical observations that support his sanguine outlook for DOGE. First, Dogecoin held a key uptrend line on the 4-hour chart (DOGE/USDT). This trendline acted as a lively support level that Dogecoin price touched but did not drop below threefold since mid-November.

Each time this trend line was touched, Dogecoin’s price rebounded, suggesting forceful buyer interest in these levels. This alignment with the uptrend line is crucial because it indicates not only support, but also increasing investor confidence each time price falls to this line and then recovers.

Resistance, however, formed near the level of $0.47. This level was tested many times and each attempt to break it met with resistance. Repeated tests of this resistance level without a breakout can usually suggest a consolidation phase, potentially setting up a stronger move higher if market sentiment changes positively.

Moreover, the chart shows a noticeable reduction in the number of open stablecoin margin contracts. According to Coinglass dataOn December 9, $86.29 million in long DOGE positions were liquidated, the highest since the 2021 bull market.

This reduction in open interest represents a major “washout” of speculative positions, usually seen as a market reset whereby weaker hands exit and excess leverage is reduced. In particular, the clearing of market participants could be another indication that a more sustainable upward move is on the way.

Another significant aspect shown in the chart is the reset of funding rates to lower levels, which is significant because it reduces the cost of maintaining long positions. Lower financing rates may encourage recent purchasing activity, particularly from participants who were previously sidelined by the high costs associated with maintaining leveraged positions.

CRG’s analysis also includes observations on cumulative volume delta (CVD) for both the futures and spot markets. The CVD for futures has fallen below the spot price, indicating that futures traders may be taking more bearish positions or exiting existing positions more aggressively compared to spot trades. This divergence suggests that the spot market, which is generally less speculative, is maintaining a bullish trend while acting as a buffer against bearish futures markets.

At press time, DOGE was trading at $0.40.

Featured image created with DALL.E, chart from TradingView.com