Dogecoin price remained in a consolidation phase this week as the US dollar index (DXY) jumped and the fear and greed index retreated. DOGE, once one of the most popular cryptocurrencies in the world, remained at $0.063, much lower than the highest point this year.
US dollar rises and fear and greed index retreats
Dogecoin is one of the biggest cryptocurrencies in the world with a market cap of over $9 billion. This makes it the eighth-biggest coin in the industry, At its peak, Dogecoin was valued at over $40 billion as its demand rose.
Recently, however, demand for Dogecoin has waned, as evidenced by the limited social media mentions and search engine trends. This trend happened as Elon Musk stopped tweeting about the coin and as the volume of cryptocurrencies retreated.
Most importantly, Dogecoin’s popularity has been overtaken by some other meme coins like Shiba Inu and Pepe. Data by CoinMarketCap shows that the volume of Dogecoin traded in the past 24 hours was just $164 million making it lower than Solana, Polygon, and Litecoin.
Read more: How to buy Dogecoin.
Dogecoin price retreated as the US dollar index (DXY) has bounced back. As I wrote here, the dollar index has jumped to its highest level in more than five months. Most importantly, it has formed a golden cross pattern, which happens when the 50-day and 200-day moving averages make a crossover.
The implication is that the DXY index will soon rise from the current $105 to over $110 in the coming weeks. In most periods, cryptocurrencies like Dogecoin and Bitcoin have an inverse relationship with the dollar index.
The US dollar has become more attractive among investors because of the rising yields in the United States. The so-called risk-free rate has moved to over 4% while some money market funds (MMF) have moved above 5%. Therefore, many investors prefer holding the USD instead of cryptocurrencies.
Dogecoin price has also wavered as the crypto fear and greed index dropped to the fear zone of 46. This fear explains why most coins have remained under pressure in the past few months.
Dogecoin price prediction
The daily chart shows that the DOGE price has been in a tight range in the past few weeks. It has remained at the consolidation phase of $0.062, where it has been at for a while. The coin is a few points below the 50-day moving average and has formed a descending triangle pattern. Oscillators like the Stochastic Oscillator and the Relatve Strength Index (RSI) have moved to the neutral level.
Therefore, the outlook for Dogecoin price is neutral with a bearish bias. A bearish breakout will see it drop to the next key support at $0.050. The stop-loss of this trade will be at $0.068.