Like other cryptocurrencies, Dogecoin declined in value in the past year. Since the beginning of 2022, it has lost more than 60% of its value. And also, since its all-time high in May 2021, it has lost more than 90 %.
Dogecoin’s Decline
It continues to rank among the top cryptocurrencies. Furthermore, Elon Musk’s takeover of Twitter has generated more interest in Dogecoin. Dogecoin has been a standout digital asset in the past week. But After recording slight losses, the token’s capacity to maintain the rise is now in focus.
Also, among the 100 top cryptocurrencies by CoinMarketCap, DOGE is ranked the greatest daily loser following the current correction.
When the price enters an empty Volume Profile, it quickly behaves as one would expect. Price action moves from one high node to another like a vacuum. Thus, there might be a flash crash everywhere.
DOGE suggests a more significant mean reversion. Its pricing has wide discrepancies.
Doge’s Correction’s Triggering Events
It is possible to claim that investors are likely removing profits from DOGE. Also, the price correction of DOGE is linked to the broader crypto market movement. The most recent decline comes after a week of over 100% weekly gains for DOGE.
Following the Twitter agreement disclosure, investors rekindle their interest in DOGE. The coin needed to perform better before the deal’s announcement. Like all coins, it’s negatively impacted by the current crypto crisis.
some investors might think that since Musk’s Twitter agreement, there isn’t any other catalyst that could increase the price.
Musk’s Effects On DOGE.
Musk has praised cryptocurrencies as a legitimate form of payment. Dogecoin’s price increased by 14% to about 20 cents in January. This was after Musk announced that Tesla would start taking it as a form of payment for purchases.
Musk is a fervent promoter of the coin; hence forecasts that DOGE may find apps on Twitter. Also, Musk’s firm Tesla has started accepting Dogecoin for payment when making purchases.
There is speculation that DOGE may be used on social media as a tipping system. Already, the two tipping currencies on Twitter are Bitcoin and Ethereum.
They presume that the asset’s limited use cases could be the critical deterrent. This is a factor when considering whether the recent rally would be sustainable. DOGE is also not regarded as a robust store of value. The asset’s rally is currently only speculative due to these restrictions.