Dogecoin Rally Halts, Setting The Stage For Potential Price Correction, Here’s Why

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As a seasoned analyst with over two decades of experience in the financial markets, I have seen my fair share of market cycles and trends. While Dogecoin’s recent price action has been nothing short of impressive, I must caution investors about a potential correction in the near future.

In simpler terms, over the last few weeks, Dogecoin has been one of the top-performing cryptocurrencies due to the overall market’s recent rise. But, looking at various factors and the current market dynamics, there could potentially be a downturn coming for the most popular meme coin.

Bearish Price Signal Emerges For Dogecoin

The potential upward trajectory of Dogecoin’s price could face a possible reversal according to Dima James Potts, a market analyst and investor. He foresees that Dogecoin might experience a short-term correction in the near future. This prediction arises from the ongoing changes in market dynamics following Dogecoin’s recent surge, which has caused apprehension among investors and traders.

The analysis by the market expert is supported by previous price patterns, most notably during the last cycle, which led to a substantial dip for Dogecoin during its surge, hinting at a similar occurrence in the present market phase. As speculation about cashing out increases considerably, this prediction raises doubts about the sustainability of the meme coin’s current growth trend.

Based on what the analyst said, during the previous market phase, Dogecoin experienced a significant drop of nearly 56% shortly after reaching the 78.6% Fibonacci point. Interestingly, this week Dogecoin has returned to that same 78.6% Fibonacci level. This suggests that another price correction similar to what happened before might occur, potentially pausing its upward momentum before it continues moving toward higher prices in the current market cycle.

According to James Potts’ analysis, while a potential downturn might be approaching, his forecast doesn’t imply selling the assets. Instead, it involves comparing the price fluctuations of past cycles with the current one, suggesting possible pullbacks as we move toward market peaks, as he previously stated.

It is worth noting that the expert anticipates a market top for Dogecoin at the psychological $10 price mark. James Potts has consistently underscored DOGE’s path to the level in several posts, which he expects to kick off in 2025.

As a researcher, I’ve been closely observing the trajectory of Dogecoin (DOGE). Its previous growth spurts – a staggering 9,000% surge in 2017 and an even more impressive 18,000% jump in 2021 – have caught my attention. If this trend continues, I am optimistic that DOGE could witness an even more substantial growth spurt in the future.

Can DOGE’s Upward Momentum Hold?

This afternoon, Dogecoin experienced a dip to approximately $0.37 following a significant price surge over the weekend. Yet, the meme-based cryptocurrency seems to be gradually regaining its upward trajectory, as DOGE has risen to $0.4366, representing a 1% growth in the past day.

The temporary retreat in DOGE’s value may be due to decreasing enthusiasm and engagement among traders, leading them to sell off their holdings. Evidence from CoinMarketCap indicates that the trading volume for this cryptocurrency has actually dropped, plummeting by more than 28% within the last 24 hours, hinting at a possible mass-selling scenario. If this selling trend continues, Dogecoin might experience a downward trend in the coming days.

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2024-11-26 08:57