Dogecoin collapsed 90% from its all-time high, touching $0.067 this week as the broader crypto market lost steam. The meme coin's monthly RSI indicator dipped below levels seen during the brutal 2022 crash, signaling extreme oversold territory that hasn't been reached before in DOGE's history.

Over the past seven days alone, the token shed nearly 2% as investors trimmed exposure across major digital assets. At press time, DOGE traded at $0.06968, down another 0.48% in 24 hours. The sharp move has split the trading community between those betting on a bounce and those expecting further pain.

Oversold doesn't always mean bottom

Analyst Ash Crypto flagged the extreme RSI reading as a potential reversal signal, arguing the market had pushed the coin into historically stretched territory. MikybullCrypto pushed back on pure bearish narratives, cautioning traders to respect the major macro support zone where DOGE currently sits. An oversold bounce could trigger meaningful upside if momentum returns, the analyst suggested, though he stopped short of calling a bottom.

The real friction in the debate centers on what Dogecoin actually offers investors. Meme coins have lost favor this cycle as capital rotates toward projects with tangible use cases, staking mechanisms, or clearer regulatory pathways. DOGE's core value proposition remains unchanged since 2013, which works against it in a market increasingly demanding substance.

Network activity ticking higher

One bright spot: on-chain data shows Dogecoin network engagement climbing. Weekly active addresses jumped 16%, rising from roughly 38,000 to 44,000, according to analyst Ali Charts. More users interacting with the blockchain despite the price collapse suggests some conviction remains among the core community, even if the broader market has written off the token.

Whether that translates to a meaningful recovery remains the open question. Traders watching DOGE need to separate the technical oversold signal, which can persist for months, from an actual turning point in sentiment.

This is informational content only, not financial advice. Cryptocurrency markets remain highly volatile and speculative.