Crash in Open Interest
Dogecoin’s open interest, a measure of outstanding futures contracts, has taken a nosedive in the past month. From a record high of $1.91 billion in March, it’s now crashed by a staggering 66.5% to just $625.7 million. This drop has brought open interest back to levels not seen since February.
Impact on Price
Historically, a sharp decline in open interest has led to a drop in cryptocurrency prices. Dogecoin has followed suit, with its price plummeting by nearly 50% as bears maintain control.
Future Prospects
If open interest continues to decline, it could further depress the Dogecoin price, potentially pushing it below the crucial $0.12 support level. However, a recovery in open interest could signal a price reversal.
Factors to Watch
The Dogecoin price is heavily influenced by Bitcoin’s performance. As Bitcoin’s price stabilizes, interest in Dogecoin may grow, leading to an increase in open interest and a potential price rebound.
