Dogecoin (DOGE), the beloved meme cryptocurrency, has witnessed a significant decline over the past few months, mirroring the broader sell-off in the crypto market. Once fueled by Elon Musk’s tweets and endorsements, Dogecoin has plummeted by over 60% from its November highs, with its price dropping to $0.019 on Sunday – its lowest level since November 7, 2023.
As the market braces for more downside, technical indicators suggest that DOGE is on the verge of forming a death cross pattern, a bearish signal that could trigger further selling pressure. In addition, rising tensions between Elon Musk and Donald Trump, along with Tesla’s tumbling stock price, have contributed to the bearish sentiment surrounding Dogecoin.
Dogecoin’s Performance and Market Trends
Dogecoin’s downfall isn’t an isolated event. Other meme coins such as Shiba Inu (SHIB), Pepe (PEPE), and Dogwifhat (WIF) have all suffered substantial losses, plunging over 50% in the past few months. This indicates a broader decline in the meme coin sector, which had previously benefited from speculative hype and retail enthusiasm.
A major reason behind Dogecoin’s slump is the diminishing influence of Elon Musk, who played a pivotal role in popularizing DOGE. Recent reports indicate that Musk is facing financial challenges, with Bloomberg data revealing a $103 billion drop in his net worth this year, bringing his total worth to approximately $330 billion.
Moreover, a tense meeting between Musk and cabinet officials like Marco Rubio has sparked speculation about Trump reining in Musk’s influence. According to the New York Times, Musk’s leadership at the Department of Government Efficiency (DOGE) has come under scrutiny, raising concerns about his continued involvement in the space. Data from Kalshi now suggests a 54% chance that Musk will exit before July 2026, further weakening Dogecoin’s support from one of its most influential backers.
Technical Analysis: Dogecoin’s Death Cross Nears
Dogecoin’s technical outlook paints a grim picture for bulls, as the coin is on the verge of forming a death cross pattern – a bearish indicator that occurs when the 50-day Exponential Moving Average (EMA) crosses below the 200-day EMA. Historically, such patterns have led to major sell-offs, with the last death cross in July 2024 resulting in a 40% price drop.
Currently, Dogecoin is trading below the 61.8% Fibonacci Retracement level at $0.2360, signaling that bears are firmly in control. The MACD (Moving Average Convergence Divergence) and RSI (Relative Strength Index) continue to decline, suggesting that selling pressure remains strong. If DOGE breaks below the 78.6% retracement level at $0.1680, it could face a sharp correction down to $0.080, representing another 60% drop from current levels.
Market Sentiment and Investor Outlook
Dogecoin’s decline reflects broader shifts in investor sentiment. The crypto market, once driven by retail enthusiasm and meme coin mania, is now experiencing a wave of skepticism. The absence of strong institutional adoption and concerns about regulatory crackdowns have further dampened enthusiasm for speculative assets like Dogecoin.
Adding to the uncertainty, Tesla’s stock has seen significant losses, impacting Musk’s ability to influence Dogecoin’s trajectory. As Musk’s focus shifts towards AI, Tesla, and SpaceX, his engagement with the Dogecoin community appears to be waning, leaving DOGE vulnerable to further declines.
Final Thoughts
The coming weeks will be critical for Dogecoin’s price action. If the death cross pattern fully materializes, DOGE could enter an extended downtrend, testing support levels at $0.1680 and possibly $0.080. The evolving dynamics between Elon Musk, Donald Trump, and regulatory authorities could further impact market sentiment.
For now, traders and investors should watch key technical levels and broader macroeconomic trends that could influence the crypto market’s direction. Stay updated for more insights on Dogecoin and the evolving cryptocurrency landscape.
