Dogecoin Price: Weak Demand Despite Support Retest, ETF Hype

Bullish expectations for Dogecoin have been dashed this month as the cryptocurrency remains trapped within its current trading range. Despite a substantial discount over the last three months and a retest of a critical support zone, DOGE has maintained its bearish trend, mirroring the overall market sentiment.

The $0.255 price point represented a 47% decline from its December peak, leading traders to anticipate a surge in buying pressure. Dogecoin has found support near the $0.24 level, particularly during the second week of February.

The recent trading range between the 0.5 and 0.618 Fibonacci levels has also fueled bullish expectations. The Fibonacci retracement, based on the lowest price in August 2021 and the December 2021 high, suggests potential demand within this zone. However, a failure to maintain support could lead to further declines.

Despite crossing above its signal line, Dogecoin's MACD indicator remains negative at -$0.02, indicating weak demand even with some bullish volume in recent days.

The current state of Dogecoin price action reflects the broader crypto market's sentiment. Negative news has dampened demand, but this may change with the possibility of ETF approvals. Rumors suggest that Dogecoin ETFs could be approved as early as next week, although official confirmation is pending.

The market sentiment around ETF approvals has shifted significantly, as evident from the rise in Polymarket expectations from 27% to 75%. This potential development could have a major impact on Dogecoin price.

As the meme coin leader, Dogecoin benefits from strong institutional interest, as indicated by multiple ETF filings. ETF approvals could unlock robust liquidity inflows, potentially driving the price towards $1 or even higher.

However, it's important to note that ETF approvals alone may not guarantee heavy liquidity, as witnessed with Ethereum. Nevertheless, the prospect of ETFs remains a positive catalyst, given Dogecoin's current discounted valuation.