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- Dogecoin (DOGE) has experienced a dramatic descent continuing a downward trend that began in December.
- DOGE however continues to trade within its short-term range, with neither the bulls nor bears taking full control of the long-term trend.
Dogecoin (DOGE) has this week experienced a sharp decline recording a drop of 15% on Thursday. It is clear from the latest price action that the memecoin is losing favor with crypto investors. This has seen the altcoin slip out of the top ten cryptocurrencies by market cap after being replaced by Avalanche (AVAX).
At the time of press, DOGE is trading at $0.083066 following its steep decline signaling the return of a bearish trend set in December. With no major news coming out this week, it seems the price change was purely instigated by the token’s technical setup.
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Over the past two years, DOGE has been stuck in a bearish pattern after reaching an all-time high of $0.731578. At current prices, the altcoin has lost nearly 88% of its value. In part, this was due to its endorsement by the world’s richest man, Elon Musk, and other influential individuals such as Mark Cuban. It was further engulfed in the wider bullish momentum sweeping the market at the time.
With weak fundamentals, the token has increasingly been falling out of favor with investors. Additionally, it has come under intense competition from Shiba Inu (SHIB). SHIB which is ranked 19th at the time of press, has shown great commitment to build and grow out of the memecoin status, making it a better fit for investors. DOGE’s market share has further been taken away by up-and-coming memecoins such as BONK, PEPE, FLOKI, and ApeCoin (APE).
Dogecoin (DOGE) Poised to Rally in 2024
Looking at the technical setup of DOGE, there is reason for bulls to be optimistic. The Relative Strength Index (RSI) a key indicator of whether a market is overbought or oversold, shows a reading of 50. This upward trend is positive for bulls, while a reading of under 50 would signal the opposite. What is of concern is that the RSI has been on a steady decline starting at 70 about two weeks ago.
In the short term, DOGE investors will be encouraged by the timely rebounds that have ensured that the token trades above key support. Since the beginning of the year, the memecoin has managed to stay above $0.080, its nearest support. Below this, investors face the prospect of testing the $0.075 lower support.
On the higher side, the token recently failed to break the $0.095 resistance as bulls aimed to climb above $0.1. The last time DOGE traded above this position was in mid-December. In the short term, the memecoin will continue to ride the wave of the wider market as well as be influenced by its technical setup. But with the new year expected to be largely bullish, DOGE investors remain optimistic of a new all-time high.