Dogecoin (DOGE) weakens as buying pressure is suppressed by low OI and unfavorable funding rate

Dogecoin (DOGE) is continuously testing the critical support zone around the 0.13 USD mark as of Wednesday, amid increasing selling pressure from higher price levels spreading across the cryptocurrency market. The largest market cap meme coin currently shows a clear weakening of its technical structure, as the recovery momentum is limited by the prolonged lull in the derivatives market, reflecting cautious and indecisive sentiment among investors.

Dogecoin Derivatives Market Remains “Silent”

Dogecoin’s derivatives market continues to be in a prolonged state of stagnation since the sharp decline on 10/10, when a broad liquidation wave of leverage occurred. Data from Glassnode shows that the total open interest (OI) of Dogecoin futures across all exchanges reached only about $645 million on Monday, a slight increase from $640 million the day before, but still far from the $1.5 billion recorded during the crash.

Notably, Dogecoin’s open interest hit a historical high of nearly $3 billion on 09/13, highlighting a significant decline in trader interest and confidence. The low OI indicates risk-averse market sentiment, continuing to restrain the formation of sustainable price recoveries.

Dogecoin OI | Source: Glassnode## Lack of Momentum in Funding Rate to Support Price

The funding rate of Dogecoin’s perpetual futures contracts continues to fluctuate unstably, preventing this meme coin from having enough support to sustain a recovery. Data from Glassnode shows the funding rate returned to 0% on Monday, down from 0.001% the previous day and significantly lower than the 0.007% recorded on Sunday.

A negative funding rate reflects traders increasing their short positions, exerting downward pressure on the price. Conversely, a positive but very low funding rate indicates market caution, with only a few investors willing to increase their exposure to DOGE. Only when the funding rate improves significantly and rises to higher levels will a bullish scenario be reinforced, opening the possibility for a more sustainable upward trend.

Dogecoin Futures Funding Rate | Source: Glassnode## Technical Outlook: Dogecoin Moves Sideways Under Pressure

As of Wednesday when this article was written, Dogecoin is fluctuating around the 0.13 USD level but remains under clear pressure as the price is continuously suppressed below key moving averages. Specifically, DOGE is currently trading below the 50-day EMA at 0.15 USD, the 100-day EMA at 0.17 USD, and the 200-day EMA at 0.19 USD — a sign that the overall technical structure still leans toward a downtrend.

The daily RSI indicator is at 41, below the neutral level, reflecting weak buying interest and cautious investor sentiment. In this context, if RSI continues to slide into oversold territory, the more probable scenario is further price weakening, increasing the risk of DOGE retesting the support zone at 0.12 USD.

Daily DOGE/USDT Chart | Source: tradingView Conversely, the market is also beginning to show a positive signal as the MACD indicator forms a bullish crossover. The MACD line has crossed above the signal line, while the histogram bars turn green and hover slightly above the zero line, indicating that the downward momentum is waning and buying pressure is improving.

However, for a genuine recovery trend to be confirmed, Dogecoin needs to break out decisively and sustain above the 0.15 USD resistance level. This could open up room for gains toward the 100-day EMA around 0.17 USD. Conversely, if the recovery attempt fails, the bears are likely to maintain control as the price remains below the 200-day EMA at 0.19 USD. Meanwhile, the ADX indicator is currently at 36 and declining, suggesting that the overall trend strength is weakening and the market may continue to consolidate until a clear breakout occurs in either direction.