Key Takeaways
February started on a sour note for many cryptocurrencies, and like other assets in the market, Dogecoin (DOGE) price bled. In the last 24 hours, DOGE has fallen roughly by 20%.
As a result, the price fell to $0.24, a level last seen in November 2024. This drop followed Donald Trump’s trade wars, where he raised import tariffs on certain countries, prompting retaliatory tariffs from those affected.
Beyond the broader economic impact, Dogecoin whales also contributed to the memecoin’s decline as they offloaded large amounts of the cryptocurrency, and added to the selling pressure.
On Jan. 17, Dogecoin price rallied to $0.41, showing signs that it could retest the 2024 high it hit after Trump’s election. However, that was not the case as the coin lost hold of the $0.30 support toward the end of last month.
According to Santiment, Dogecoin whales also added fuel to this fire. For instance, on Feb. 1, the balance of addresses holding between 100 million and 1 billion DOGE was 23.37 billion.
This metric refers to the total amount of DOGE held by large investors or entities. When whales accumulate, it indicates confidence and potential price stability or increment. On the other hand, when they offload their holdings, it can trigger selling pressure and price decline.
As of this writing, that figure has decreased to 23.06 billion. This indicates that whales have dumped 310 million coins, worth approximately $75 million.
Following the decline, Dogecoin price had fallen into the oversold region, according to the Relative Strength Index (RSI) shown on the daily chart.
The RSI measures momentum and also tells if a cryptocurrency is oversold or overbought. Readings above 70.00 indicates that an asset is overbought and oversold when the RSI is below 30.00.
As seen below, the RSI has continued to hit lower values. Furthermore, the Bull Bear Power (BBP) is in the negative region.
The negative reading of the BBP indicates that bears have more strength than bulls. Therefore, it is likely for Dogecoin price to keep falling, especially as bulls failed to defend the $0.30 support.
Should this trend continues, then DOGE might continue to hit lower lows. Using the Fibonacci retracement levels, the daily chart reveals that Dogecoin price is on the verge of dropping below the 0.382 support floor.
Historically, when prices sink below this Fib level, it opens doors to an extended correction. If validated, then DOGE might soon plummet t0 $0.18, which will represent a 3-month low for the memecoin.
However, if Dogecoin whales refrain from intensifying selling pressure, and instead, increase accumulation, the trend might change.
In that scenario, DOGE price might rally to $0.40 at the 0.786 Fibonacci level. But for that to happen, bulls have to mount a strong defense at $0.30 as soon as the price rebounds from this oversold zone. If not, capitulation might occur.