Dogecoin extended its decline on Thursday, approaching the $0.07 support level as escalating conflict between the United States and Iran rattled global markets. The meme coin's slide mirrors a broader downturn across the cryptocurrency sector, with traders reducing exposure to riskier assets amid heightened geopolitical uncertainty.
Geopolitical Shock Weighs on Crypto Sentiment
Renewed hostilities in the Middle East have dampened investor appetite for volatile assets. Iran launched attacks on US military installations following American airstrikes on Iranian targets. The US also reimposed sanctions on Iranian oil exports, citing threats to commercial shipping in the Strait of Hormuz. These developments have stoked fears of a wider regional conflict, prompting a flight from risk assets, including cryptocurrencies.
The Crypto Fear & Greed Index has fallen to 26, firmly in the Extreme Fear zone. Historically, such readings signal heightened risk aversion and often precede further downside pressure. Unless sentiment improves, Dogecoin and other digital assets may remain under pressure.
Derivatives Data Shows Cautious Optimism
Despite the price weakness, derivatives data suggests some traders maintain a longer-term bullish view. According to CoinGlass, Dogecoin perpetual futures open interest (OI) rose to $1 billion, up from $995 million on Wednesday. The increase indicates that traders are holding or opening positions even as the spot market corrects, reflecting cautious confidence in the asset's recovery potential.
For context, recent Dogecoin whale accumulation hit 73.85B DOGE while retail volume dropped 5%, suggesting large holders are positioning for a rebound.
Technical Outlook: Bears Remain in Control
On the 4-hour chart, Dogecoin continues to trade below its 50-day EMA ($0.08), 100-day EMA ($0.09), and 200-day EMA ($0.11). Momentum indicators point to persistent selling pressure, though bearish momentum has eased slightly. The Relative Strength Index (RSI) is near 36, recovering from oversold levels but still indicating weak buying interest. The Moving Average Convergence Divergence (MACD) histogram has turned slightly positive, hinting at a tentative recovery, but the signal is too weak to confirm a trend reversal.
Key resistance lies at $0.08. A daily close above this level could open the path to $0.09 and the 200-day EMA at $0.11. However, if selling pressure continues, the next major support is near $0.05. A drop to that level would test buyers' ability to defend Dogecoin's longer-term structure.
In the broader market, Dogecoin slid 2% as ETF inflow failed to reverse the bearish trend, underscoring the challenge for bulls.
Until bullish momentum strengthens, Dogecoin remains vulnerable to further downside amid persistent macroeconomic and geopolitical headwinds.
This article is for informational purposes only and does not constitute financial advice.
