The DOGE price decline could extend. | Credit: CCN
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Key Takeaways
The Dogecoin funding rate has turned negative, indicating rising bearish sentiment.
Open Interest has also dropped, signifying decreased exposure to the cryptocurrency.
DOGE’s price has fallen below the 20 and 50 EMA, revealing potential lower lows.
Before 2025 began, there were several predictions that Dogecoin’s (DOGE) price might hit a new high by January.
These forecasts were due to Donald Trump’s victory as U.S. president, with Elon Musk’s involvement playing a key role.
However, since Dec. 14, DOGE has dropped by 20%, indicating that the anticipated rally this month might not come to pass. This drop has also dampened the bullish sentiment Dogecoin traders had.
Below is a detailed overview of the key developments surrounding DOGE.
Dogecoin Sees Massive Exit of Capital in the Market
Dogecoin’s rally began in November 2024 moments after Trump won the U.S. election. Between Nov. 5 and Dec. 9, the memecoin rallied from $0.15 to $0.47.
Due to that price action, the funding rate at that time was positive. The funding rate acts as a measure of traders’ expectations, showing if most are holding long positions or otherwise.
When it is positive, most positions are long, indicating that traders anticipate a price increase. However, according to Santiment, Dogecoin’s funding rate has dropped to the negative region.
This decline indicates a dominance of short-position traders, signifying bearish sentiment around the cryptocurrency.
DOGE Funding Rate | Credit: Santiment
Should the sentiment remain the same, DOGE price could find it challenging to rebound.
Apart from the funding rate, Dogecoin’s Open Interest (OI) is another indicator that reveals a further price decrease.
Open Interest refers to the value of the total number of open positions in a contract. An increase in OI reflects that, on a net basis, traders are expanding their positions, indicating heightened interest and buying pressure.
Alternatively, a decrease in OI suggests that traders are reducing their exposure to a cryptocurrency. At the time of writing, DOGE’s OI has dropped to $1.52 billion.
This decline—which is far below the peak recorded on Jan. 7—indicates waning interest in DOGE. From a price perspective, if the OI continues to decline, then Dogecoin price risks hitting a yearly low.
On Jan. 8, the DOGE price climbed above both the 20 EMA (blue) and 50 EMA (yellow). That rise hinted at a sustained price hike. However, that did not happen, as the cryptocurrency’s value has now dropped to $0.32.
Typically, if the price is above the EMAs, the trend is bullish. But since it is the other way around, it implies that Dogecoin might continue to face a lingering downturn in the short term.
If this trend continues, the coin’s value might drop to the 0.236 Fibonacci retracement level at $0.21. But if the cryptocurrency can resist declining below 0.50 Fib retracement point, that might not happen. Instead, DOGE’s price could rally to $0.41 at the 0.786 Fibonacci level.
DOGE/USD Daily Chart | Source: TradingView
Outside the on-chain and technical outlook, the upcoming Trump inauguration might also play a part in Dogecoin’s potential performance.
In the event that the U.S. President-elect discusses his crypto plans or Elon Musk takes the stage, too, DOGE could climb toward $0.50. However, if there is no mention of that, the coin’s value could sink to $0.21.
Disclaimer:
The information provided in this article is for informational purposes only. It is not intended to be, nor should it be construed as, financial advice. We do not make any warranties regarding the completeness, reliability, or accuracy of this information. All investments involve risk, and past performance does not guarantee future results. We recommend consulting a financial advisor before making any investment decisions.
Victor Olanrewaju is a crypto analyst and reporter at CCN with deep roots in on-chain research and technical analysis. His crypto journey began in 2017, but it was the 2020 Uniswap airdrop that sparked a full-time pivot into the space.
With a foundation in copywriting, Victor honed his craft creating high-converting content for leading crypto brokers — most notably an XRP price prediction that ranked #1 on Google during the 2021 bull run.
He later joined AMBCrypto in 2022, where he combined storytelling with technical and on-chain analysis to cover key market narratives.
In 2024, he expanded his expertise at BeInCrypto, collaborating with analysts and using tools like Glassnode, Santiment, and IntoTheBlock to break down Bitcoin and altcoin trends.
At CCN, Victor covers the top cryptocurrencies, memecoins, macro shifts, blending real-time insights with deep-dive metrics.
He holds a Bachelor’s degree in Physics from the University of Ibadan, equipping him to simplify complex data for a wide audience. Follow his work or connect on LinkedIn or X.
