Dogecoin (DOGE), the meme coin with the highest market capitalization, briefly climbed to $0.11 on August 25. However, following a decline over the next 24 hours, it slipped back to $0.10.
This drop in DOGE’s value mirrors a broader market downturn that has impacted many other cryptocurrencies, leading to widespread declines across the sector.
Dogecoin Takes 1% of the Market Wipeout
According to Coinglass, the recent price drop in Dogecoin (DOGE) and other cryptocurrencies led to $341 million in liquidations within 24 hours. Liquidation happens when traders can’t meet margin requirements, forcing exchanges to close positions, especially those with high leverage. Dogecoin accounted for roughly 1% of the total liquidations, amounting to $3.08 million, with long positions being hit hardest.
Liquidations not only reflect a wave of position closures but also play a role in shaping price trends. For DOGE, the increase in long liquidations amid the price drop indicates a heightened risk of the coin’s value falling to its underlying support level.
Read more: Dogecoin vs. Bitcoin: An Ultimate Comparison
If short liquidations had dominated, Dogecoin (DOGE) would have had a better chance of a quick rebound. During this period, DOGE’s trading volume surged above $700 million before dipping below that level.
Volume serves as a key indicator of market interest, showing how much value is being traded. It can also suggest the potential direction of an asset’s price.
For example, when volume rises along with price, it typically reinforces an uptrend. Conversely, if volume decreases while the price increases, the upward momentum weakens, suggesting the asset’s value may decline.
For Dogecoin, the surge in volume alongside a price decrease indicates that the downtrend could gain more power. If this remains the same, the meme coin’s price might drop below $0.10 as it did earlier today.
DOGE Price Prediction: The Struggle Continues
The daily chart indicates that Dogecoin (DOGE) is close to retesting the support level around $0.10. However, resistance at this same price level could prevent further gains unless bulls manage to break through it.
Adding to the bearish outlook, DOGE is currently trading below a descending triangle, a bearish technical pattern. This pattern is characterized by a declining upper trendline, indicating lower highs, and a flat horizontal line marking support.
Read more: Dogecoin (DOGE) Price Prediction 2024/2025/2030
If DOGE fails to break above this descending triangle, its price could fall to $0.097, with a worst-case scenario seeing a drop to $0.080.
Conversely, if DOGE breaks above the triangle, it could reverse sharply to the upside, potentially pushing the price towards $0.12.
The post Dogecoin (DOGE) Faces Fresh Challenges as Market Liquidations Exceed $300 Million appeared first on BeInCrypto.
