Dogecoin trading volume drops to $415 million, potentially triggering another 300% surge
This drop aligns with DOGE's failure to break through $0.48 since December 8. If this trend continues, the meme coin's year-to-date (YTD) 300% increase may face further downward pressure.
In October, Dogecoin's price was $0.10. By the first week of December, it had surged to $0.48, with several analysts suggesting that the cryptocurrency's value could be higher. The price surge may be related to Donald Trump's election as President of the United States and the return of retail investors.
Weeks after Trump's election, Dogecoin's trading volume climbed to $5.69 billion, reflecting significant interest in cryptocurrency trading. However, as of the writing of this article, Santiment data shows that the trading volume has dropped to $415.31 million.
This is the lowest level since November 4. An increase in volume is generally a bullish signal. Therefore, if the recent decline continues, it suggests that DOGE may face another price drop in the short term.
Another indicator suggesting further declines for DOGE is the weighted sentiment. The weighted sentiment index measures the broader market's view on cryptocurrency through comments on social media platforms.
According to the 4-hour chart, DOGE continues to trade below a descending triangle. The descending triangle is a bearish chart pattern characterized by a downward sloping upper trend line and a flatter horizontal lower trend line.
This pattern typically suggests a continuation of price declines, as sellers consistently push prices lower while buyers struggle to maintain support at the horizontal trend line.
With DOGE's price below the lower support line, it indicates that bulls may struggle to push the meme coin higher in the short term. Conversely, the cryptocurrency's value may break below $0.36.
