Dogecoin (DOGE) is facing a significant price correction. The meme coin is in a downturn across almost all time frames. Dogecoin's price has dropped 1.6% on the daily chart, 13.6% on the weekly chart, 12.9% on the 14-day chart, and has decreased 21.7% month-over-month. Despite the substantial correction, this meme coin has still risen 40.4% since June 2024.
Why Dogecoin may rebound soon
According to X user 'Trader Tardigrade', the average directional index (ADX) of Dogecoin seems to reflect its trend in 2020. By the end of 2020, Dogecoin was trading at around $0.004. By May 2021, the original memecoin's price soared to an all-time high of $0.7316. This increase represents a gain of approximately 18,175%. If Dogecoin experiences a similar rise, its price could skyrocket to $31.25.
DOGE's trading volume recently surpassed the $1 billion mark. The surge in volume may indicate buying pressure.
Given the current market environment, the likelihood of Dogecoin (DOGE) reaching $31.25 is very slim. In the coming weeks, the trend of Dogecoin (DOGE) is likely to follow that of Bitcoin (BTC). Unless BTC experiences volatility, Dogecoin (DOGE) is unlikely to fluctuate significantly.
Cryptocurrency is falling amid high volatility and uncertainty
DOGE is not the only cryptocurrency in the red zone. Nearly all major cryptocurrencies have experienced significant corrections in the past few days. The recent market crash occurred following the escalation of the Israel-Iran conflict. Market participants may expect increased volatility in the coming weeks.
The pullback in Dogecoin (DOGE) and the broader cryptocurrency market may also stem from the upcoming Federal Open Market Committee (FOMC) meeting. Traders will be looking for clues about potential changes in Federal Reserve policy (if any). Many had previously anticipated a rate cut. As it stands, the likelihood of a rate cut appears low. Trade wars and geopolitical tensions may lead financial authorities to downgrade GDP growth forecasts.
