Dogecoin Price News: Volumes Explode After 10% Drop – Is $0.17 Possible?

Dogecoin (DOGE) has dropped sharply in the past 24 hours, losing 10% of its value as the crypto market as a whole has experienced a strong correction.

Last week, the U.S. Federal Reserve cut rates for the first time this year by 25 basis points and a second cut is expected for next month’s FOMC meeting.

The market initially reacted positively and most cryptos, including DOGE, rallied. However, investors seem to be ready to take some profits off the table as shown by today’s strong move downward.

DOGE Bleeds Despite Abundance of Positive Catalysts

Crypto long liquidations in the past 24 hours have surged to a 6-month record as they exceeded $1.6 billion. This indicates that the market was quite over-leveraged and excitement got a bit out of hand.

DOGE Liquidations (Last 6 Months) – Source: CoinGlass

Last week, the first exchange-traded fund (ETF) linked to Dogecoin was launched in the United States. Since then, the REX-Osprey DOGE ETF (DOJE) has amassed $8.7 million in assets just two days after hitting the trading floor.

This is a meager amount compared to the $300 million that Solana’s recently-launched ETF has brought in and next to nothing compared to what vehicles linked to Ethereum and Bitcoin have attracted in terms of capital.

However, this ETF launch is considered a landmark moment that has boosted the credibility of meme coins as a whole and that could propel DOGE to a whole new stage of institutional adoption.

Just a week ago, a company called CleanCore added another 100 million DOGE tokens to its treasury, boosting the size of its war chest to more than 600 million – around $143 million at today’s prices.

As corporate and institutional involvement increases, the future seems bright for DOGE. However, today’s drop should remind investors that cryptos continue to be quite volatile and that short-term gains could be wiped out in just hours.

A Break Below This Key Support Could Risk a Move to $0.17

The $0.285 level is once again acting as a ceiling for the top meme coin and this would be the third time that the token retreats strongly off this level.

DOGE/USD Daily Chart (Coinbase) – Source: TradingView

This jump in trading volumes indicates that the market was betting on the continuation of the rally after last week’s bullish breakout. However, DOGE could now be eyeing the 200-day exponential moving average (EMA) as its nearest landing zone.

If this key line fails to hold, DOGE could experience a much sharper correction and the strength of this bull market could be put under question.

The Relative Strength Index (RSI) shows that DOGE already needed a breather as the oscillator had climbed to overbought levels. The RSI has now crossed below the 14-day moving average, which is typically considered a sell signal.

A stronger drop could push DOGE to the trend line support shown in the chart at around $0.175. A bounce off this level would be highly likely as market conditions continue to support a bullish outlook for cryptos, aided by lower interest rates, a pro-crypto administration, and growing interest from institutional and corporate players.