Dogecoin Wary of the Fed, What's the Momentum to Break Through the $0.100 Threshold?

▲ Dogecoin (DOGE)/ChatGPT generated image ©

As investor sentiment across the virtual asset market freezes ahead of the U.S. Federal Reserve's (Fed) interest rate decision, meme coin leader Dogecoin (DOGE) failed to break the psychological threshold of $0.100 and fell back to the $0.098 level.

According to investment media FXStreet on April 28 (local time), Dogecoin has been stuck in a dull sideways trend between the $0.090 support level, failing to overcome strong sell walls stacked around $0.100. This price adjustment exactly aligns with the cold investor sentiment in the virtual asset market, which is weighed down by macroeconomic uncertainties. Indeed, the Crypto Fear & Greed Index plummeted from 47 to 33 the previous day, reflecting a strong sense of caution in the market.

The primary factor chilling the market atmosphere is the escalating geopolitical crisis in the Middle East. Although expectations for a diplomatic resolution between the U.S. and Iran had emerged, the situation reverted to square one after U.S. President Donald Trump abruptly canceled the dispatch of a peace envoy. The U.S.'s firm stance that it would not accept a compromise on opening the Strait of Hormuz without Iran's abandonment of its nuclear program was reconfirmed, leading to a rapid spread of risk-aversion sentiment.

Individual investors' enthusiasm for Dogecoin is also rapidly cooling. As of Tuesday, open interest in the futures market slightly decreased from $1.37 billion the previous day to $1.35 billion. While it has somewhat recovered from the March low of $894 million, it is still far below the September peak of $6 billion, which fueled past explosive rallies. The bearish trend in the derivatives market is unfavorable for bulls (buyers) looking for short-term gains.

Nevertheless, positive signs remain. The weighted funding rate for open interest has consistently stayed in positive territory since mid-April, at 0.0089%. This suggests that buyers' willingness to maintain long positions, betting on price increases even if it means paying a premium, remains strong. Technically, Dogecoin has also maintained its 50-day Exponential Moving Average (EMA) at approximately $0.096 and the middle band of the Bollinger Bands on the daily chart, showing short-term downside support that is neutral or better.

While the Moving Average Convergence Divergence (MACD) histogram remains positive, indicating a bullish bias, for Dogecoin to successfully rebound, it must break through the upper Bollinger Band at $0.101 and the 100-day Exponential Moving Average at $0.104. Conversely, if downside pressure intensifies and the $0.096 support level collapses, a deeper correction to the lower Bollinger Band at $0.091 and the former trend resistance level of $0.089 is expected to be inevitable.

*Disclaimer: This article is for investment reference only, and we are not responsible for any investment losses based on it. The content should be interpreted for informational purposes only.*