Dogecoin (DOGE) has experienced significant selling pressure, declining over 30% in the last two weeks. Currently trading at $0.21, DOGE struggles to maintain key support levels amidst broader market weakness. Meme coins, including Dogecoin, have seen some of the most substantial recent declines, reflecting investor apprehension during the current market correction.

Glassnode's on-chain metrics indicate that long-term Dogecoin holders are in a state of "denial," suggesting growing uncertainty among those who have held DOGE for an extended period. The DOGE Long-Term Holder Net Unrealized Profit/Loss (NUPL) indicator shows a consistent decline, indicating many early investors are experiencing diminishing unrealized profits or even losses. Continued market weakness could force these holders to sell, further depressing the price.

Dogecoin's Critical Support Levels: What's Next?

DOGE's recent fall from its December high of $0.48 to a recent low of $0.19 represents a 59% drop. Crypto analysts are divided on whether this signals a prolonged bear market or a potential price reversal. While technical indicators point towards bearish momentum, some on-chain data suggests a possible recovery if buyers regain control. Analyst Ali Martinez notes that DOGE's NUPL indicator suggests long-term holders are hesitant to sell despite market uncertainty. Historically, such "denial phases" have resulted in either a final capitulation or a strong recovery, depending on whether buyers regain dominance.

Can Dogecoin Recover?

Trading at $0.21, Dogecoin is down 19% since Monday, facing resistance at $0.24 – a level bulls must reclaim to signal an uptrend. Failure to hold above $0.21 could push prices lower, potentially testing previous support levels.

A recovery rally requires stabilization and a break above $0.24. However, persistent selling pressure could lead to prolonged consolidation or further decline. Bitcoin's price will significantly influence DOGE's recovery prospects.

Traders should monitor key signals, including whether buyers can defend current demand zones and reclaim critical resistance levels. Sustained buying interest could potentially propel DOGE towards $0.30 or higher.

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