Leading meme coin Dogecoin saw a 25% intraday surge on Wednesday, briefly overtaking Ripple’s XRP in market capitalization. However, this rally has turned out to be short-lived as a wave of selling pressure has washed over the market, erasing the gains and pushing DOGE back below XRP.

As of this writing, DOGE trades at $0.192, witnessing a 9% price drop over the past 24 hours. With waning bullish sentiment, the meme coin may extend its losses. This is why.

Dogecoin Falls Back Under XR

Wednesday’s cryptocurrency market surge following Donald Trump’s victory in the 2024 US elections triggered a double-digit jump in Dogecoin’s value. The meme coin soared by 25% in a single trading session, reaching a monthly high of $0.211. 

This surge briefly allowed Dogecoin to surpass Ripple’s XRP, claiming the seventh spot in market capitalization. However, as profit-taking set in, XRP quickly reclaimed its position, relegating DOGE down the ranks. The meme coin trades at $0.192 at press time, having shed 9% of its recent gains over the past 24 hours. 

Moreover, on-chain data has revealed an uptick in Dogecoin’s exchange netflows, confirming that traders are cashing in on their profits. Per IntotheBlock’s data, the coin’s exchange netflow — which measures the difference between deposits and withdrawals — has reached 852.46 million DOGE over the past 24 hours.

When an asset’s exchange netflow increases, it indicates that more of the asset is being deposited into exchanges than withdrawn. In the short term, a positive netflow suggests that more investors are looking to sell the asset. This could lead to downward pressure on the price as supply increases relative to demand.

Further, the overall market sentiment towards Dogecoin does not inspire any confidence. At press time, its weighted sentiment is -0.16. 

An asset’s weighted sentiment measures the overall mood of the market regarding it. When the value of an asset’s weighted sentiment is below zero, most social media discussions are fueled by negative emotions. This often indicates that market participants expect a decline.

DOGE Price Prediction: Support Levels in Focus

DOGE is currently trading at $0.192, just below the $0.193 level it attempted to establish as a support floor during yesterday’s rally. With waning buying pressure, the meme coin’s price could pull back toward $0.172. If this level fails to hold, it would confirm the continuation of the downtrend, causing a Dogecoin fall toward $0.154.

However, if DOGE bounces off support at $0.172 and begins an uptrend, it could break through the $0.193 resistance and set its sights on reclaiming its year-to-date high of $0.228.

Source : BeInCrypto - Nov 7, 2024