Dogecoin(DOGE), the meme-inspired cryptocurrency, has suffered a significant setback in recent days as a broad crypto sell-off caused its price to drop. The sell-off was sparked by fears over the Federal Reserve’s tightening policies and the Securities and Exchange Commission’s crackdown on US-based crypto staking services.
As a result, Dogecoin has stabilized just above its 50-day Simple Moving Average (SMA) near the $0.08 level, down over 10% for the week and close to 18% lower than its recent highs of $0.10. Despite this setback, Dogecoin is still up over 60% from its 2021 lows of under $0.05.
Price Prediction: Where Next for Dogecoin?
The recent drop in Dogecoin’s price has raised questions about whether the cryptocurrency has broken out of its bear market that began in the second half of 2021 and lasted through most of 2022. Despite this, many investors are still hopeful that billionaire Elon Musk, who recently took over Twitter, may implement Dogecoin into a future payment system on the platform.
However, falling engagement on Twitter and a decrease in engagement on Elon Musk’s posts has caused some analysts to become concerned that Twitter may not provide the boost to Dogecoin’s prices that was previously hoped. A recent study found that US usage of Twitter had decreased by 9% since Musk took over, with many Democrats leaving the platform due to Musk’s perceived right-wing political leanings.
In the near term, it appears that a retest of the $0.079 support level and possibly a drop towards the 200-day SMA at $0.077 is more likely than a recovery back to the recent highs of $0.10. If next week’s US Consumer Price Index (CPI) data is weaker than expected, this could improve sentiment. However, in the near future, Dogecoin is likely to remain restricted within its multi-month range of $0.07 to $0.11.
Alternatives to Consider
Given the uncertain outlook for Dogecoin, traders looking for quick gains may prefer to consider alternative high-potential tokens. The CryptoNews Industry Talk team has analyzed the top 15 cryptocurrencies for 2023 and has updated its list of the best candidates on a weekly basis, including new altcoins and ICO projects.