The price of Dogecoin has fallen for two days in a row as sentiment in the cryptocurrency industry worsens.
Dogecoin (Doug(), the largest meme in the cryptocurrency market, fell 6% on January 8, hitting a low of $0.3415, its lowest level in almost a week.
This decline occurred in a high-volume environment, with $5.26 billion worth of tokens changing hands, compared to $3.3 billion on Tuesday. The rise in trading volume indicates that some investors have begun to liquidate their positions.
The decline of Dogecoin led to a significant increase in liquidations. $20 million worth of bullish positions were liquidated on Tuesday, followed by nearly $15 million on Wednesday. This liquidation is the largest since December 19. When large liquidations occur, it often results in a sharp drop in prices as bullish leveraged trades are automatically closed by exchanges.
Additional data shows that Dogecoin's weighted funding rate remained positive, indicating a decline in demand for long positions. This also reflects increased caution as cryptocurrency prices decline amid... US bond yields rise.
The odds of the SEC accepting a DOGE ETF this year remain low. according to PolymarketThese odds fell by 13% to 36% on Wednesday.
However, some analysts expect Dogecoin price to bounce back. like We wrote earlier, Bitcoin, Which often leads broader cryptocurrency market trends, remains in a strong bull market and has formed a bullish pennant pattern, which usually indicates more gains to come.
In a post on X, KrissPax noted that DOGE's current price action mirrors previous patterns seen in 2023 and 2024. He noted that the currency rose in November 2023, followed by a decline, a consolidation phase, and a subsequent recovery in 2024.
Dogecoin price analysis
The price of Dogecoin has been falling over the past few weeks, falling from its December high of $0.4830 to $0.34. Despite the decline, it is still above the 38.2% Fibonacci retracement level and the 50-day and 100-day moving averages.
The Percentage Price Oscillator indicator has turned bullish, with its histogram remaining above the zero line.
Given these factors, DOGE is likely to remain in this range before rebounding to last year's high of $0.4830 in the current quarter. Such a move would represent an increase of 43.50% from the current level. However, an alternative bearish scenario could see the coin fall to $0.2630, the December 20 low.
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