Dogecoin Price Analysis: DOGE Technical Analysis Points to Potential Recovery

Dogecoin (DOGE) has experienced a sharp decline, dropping 12.4% in the past 24 hours to $0.31, following Federal Reserve Chair Jerome Powell’s hawkish comments about inflation and unemployment projections.

Dogecoin Price Analysis: DOGE Technical Analysis Points to Potential Recovery
Dogecoin price analysis

Despite maintaining its position as the seventh-largest cryptocurrency with a market capitalization of $46.6 billion, DOGE now trades 35% below its 2024 high of $0.47. Not only has the sell-off been followed by notable market activity; trading volume has surged 67% to $10.25 billion. Based on CoinGlass data, Binance clearly experienced over $83 million in outflows as its trading volume surged 74% to $1.85 billion. Most major exchanges have clearly shown this focused selling pressure, which points to a larger market exodus.

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What’s Affecting DOGE Price?

Following the Federal Reserve’s most recent economic assessment, the current drop coincides with more general market weakness. Powell’s remarks on ongoing inflation worries led up a sell-off across risk markets even as the Fed delivered a predicted 25 basis point reduction. During this period the bitcoin market experienced nearly $1.1 billion in liquidations; DOGE alone had $35.1 million in liquidations.

Looking ahead, the relationship between Tesla CEO Elon Musk and President-elect Donald Trump as well as generally favorable crypto legislation predicted from the next government could be sources of DOGE’s recovery impetus. Given the erratic character of meme cryptocurrencies and their sensitivity to macroeconomic events, investors should still exercise caution nonetheless.

DOGE/USD Technical Analysis

DOGE/USD

 

Technical indicators show DOGE’s near-term prospects in an attractive light. Reflecting trends seen in the 2021 bull market, the Relative Strength Index (RSI) lately peaked at 90% before falling to about 43%. With a 28% loss over 35 days instead of the prior cycle’s 55% plunge in 25 days, the current correction has notably been less severe than its 2021 equivalent.

The Bollinger Bands indicator points to DOGE being presently quite oversold, trading below the lower band at $0.3576, possibly indicating an approaching market reversal. Analysts warn, nevertheless, that despite these oversold circumstances, instantaneous recovery could not be assured.

Dogecoin Price Predictions

DOGE might keep declining to $0.28 in January 2025 before showing an amazing comeback, according to CoinCodex price predicitons. Their projections show a possible rise to $0.66 by February 2025, then an ambitious target of $1.21 in March, therefore reflecting a 284% rise from present levels.

Market analysts—including crypto specialist Master Kubrick—have found January 2, 2025, to be absolutely vital for DOGE traders to keep an eye on. The study notes a narrowing timeframe between RSI peaks that would indicate ongoing upward potential and compares present market conditions with past bull cycles.

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ABOUT THE AUTHOR See More
Arslan Butt
Index & Commodity Analyst
Arslan Butt serves as the Lead Commodities and Indices Analyst, bringing a wealth of expertise to the field. With an MBA in Behavioral Finance and active progress towards a Ph.D., Arslan possesses a deep understanding of market dynamics.His professional journey includes a significant role as a senior analyst at a leading brokerage firm, complementing his extensive experience as a market analyst and day trader. Adept in educating others, Arslan has a commendable track record as an instructor and public speaker.His incisive analyses, particularly within the realms of cryptocurrency and forex markets, are showcased across esteemed financial publications such as ForexCrunch, InsideBitcoins, and EconomyWatch, solidifying his reputation in the financial community.
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