Dogecoin price dropped near $0.20 as crypto liquidations topped $758 million. Traders reacted to the Fed’s pause and pressure from a stronger dollar.
By Godfrey Benjamin
Editor Hamza Tariq
Updated
4 mins read
The digital asset market saw a drastic drop this week, with top memecoin Dogecoin DOGE $0.21 24h volatility: 4.3% Market cap: $30.84 B Vol. 24h: $3.11 B among the worst hit.
A stronger dollar and unchanged interest rates pushed traders to exit risky positions. Notably, this development led to massive losses across top exchanges.
Dogecoin price fell by nearly 10% in one day, dropping to $0.201 as of July 31. It has now lost over 11% in the past week. The coin has been falling since reaching a high of $0.248 on July 28. Despite the recent drop, analysts like Javon Marks remain optimistic, suggesting Dogecoin has strong potential for significant gains.
However, it is important to mention that if the decline continues, this would be the fifth day in a row that Dogecoin closes lower. Importantly, the fall in price followed a strong move by the dollar, which has gained more than 3% over the past four weeks.
Per historical trends, as the dollar rises, traders tend to pull out of riskier assets like cryptocurrencies.
This week’s data also showed that the Federal Reserve kept interest rates at 4.25%. Many traders had expected a cut in September, but that now seems unlikely. The latest inflation data showed that the core PCE index rose by 2.8% compared to last year, the same rate as May.
These updates triggered an increase in sell orders in the crypto market. In total, over $758 million worth of leveraged positions were liquidated. Most of that came from long positions bets that prices would go up. According to CoinGlass, $706 million of the liquidations came from long traders who were caught off guard by the drop.
Per the update, Ethereum ETH $3 565 24h volatility: 5.4% Market cap: $429.00 B Vol. 24h: $42.34 B saw the biggest losses, with over $231.41 million in long and short liquidations, respectively. Bitcoin BTC $114 068 24h volatility: 3.1% Market cap: $2.27 T Vol. 24h: $65.93 B and Dogecoin followed closely with $182 million and $23.16 million in combined liquidations, respectively.
Dogecoin is now below its 200-day simple moving average of $0.212. It’s currently trading at $0.2054, down by 8% in the past 24 hours. Traders are closely watching the $0.20 mark.
If the coin falls below this point, the next support is expected around $0.194, near the 50-day Moving Average. If buyers return, they may try to push it back above $0.212.
Dogecoin Daily Price Chart | Source: TradingView
Nevertheless, Dogecoin whales bought 310 million DOGE in a day, sparking excitement as analysts predicted a rally of over 200%. This surge has fueled speculation about whether Dogecoin might reach $1 before year-end.
It is important to mention that the mood remains cautious as the stronger dollar continues to weigh on the crypto market, with Dogecoin under close watch.
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Disclaimer: Coinspeaker is committed to providing unbiased and transparent reporting. This article aims to deliver accurate and timely information but should not be taken as financial or investment advice. Since market conditions can change rapidly, we encourage you to verify information on your own and consult with a professional before making any decisions based on this content.
Benjamin Godfrey is a blockchain enthusiast and journalist who relishes writing about the real life applications of blockchain technology and innovations to drive general acceptance and worldwide integration of the emerging technology. His desire to educate people about cryptocurrencies inspires his contributions to renowned blockchain media and sites.
