HomeMemecoin NewsDOGEDogecoin Crash Sparks Panic as Price Slips Into Final Correction Phase

Dogecoin Crash Sparks Panic as Price Slips Into Final Correction Phase

Date:

  • Since December 2024, Dogecoin has plunged more than half its value, triggering panic, but analysts suggest a potential rebound is near.
  • Technical indicators, including MACD consolidation and RSI divergence, show patterns similar to early 2024, just before DOGE surged 400%.
  • Binance data shows 72% of traders hold long DOGE positions, signaling high optimism, but also raising risks of volatility if sentiment flips.

Since December 2024, Dogecoin continued being on the constant downward path after reaching local peak in November. Within only four months, the meme-themed crypto has lost over half of its value, and that bearish rally continued into the new year 2025. Investors have been worried about such steep decline, but crypto analyst Trader Tardigrade thinks Dogecoin could soon launch an impressive rebound from the correction phase.

In a recent X post, Trader Tardigrade pointed to striking similarities between the way the Dogecoin chart patterns have been rapidly unfolding right now and how they happened in early 2024 just before a huge 400% price rally. The analyst also observes that certain technical indicators are pointing to another breakout that could mirror last November’s rally.

The consolidation in the ongoing MACD (Moving Average Convergence Divergence) is one of the key indicators, as it is occurring following the wider market crash in January. The price action that occurred within months before the 2024 breakout is very much the same as the one we are currently seeing here. Such a MACD setup had persisted back then for several weeks before the market reversed sharply to the upside. It seems that the current chart is following a similar trend.

RSI (Relative Strength Index) divergence has begun recurring once more. Just weeks before the rally is supposed to happen in 2024, the RSI had a dip followed by a fast rebound in October. Now, it is confirmed that this same divergence occurred in April 2025, where a steep downturn was then followed by a sudden pick-up in traffic. The pattern is continuing to establish a bottom if the performance is carried on as per past patterns, which may indicate that we might be about to exit the downtrend and enter into a period of recovery.

Dogecoin Eyes Massive Breakout Amid Market Parallels

If its current price action hints at Dogecoin’s performance in 2024, then the coin could be set for a major rebound. At that time, the meme coin surged by 400% between October and November, peaking at almost $0.5. However, if history follows, Dogecoin may see a similar 400% rally from today’s levels and reach an all time high of $0.73. This likely has far-reaching implications for meme coin market, with other token such as Shiba Inu and PEPE following in it’s footsteps.

While the optimism remains, the picture remains largely dependent on macroeconomic conditions and political developments. Donald Trump’s tariff war is set to calm for three more months, and the market could send the wrong signals if the deal is made after that.

Dogecoin Traders Heavily Tilted Toward Long Positions

Let’s check what the last snapshot of Binance futures market data on Dogecoin is like at the moment, It has quite a strong bullish sentiment among traders. Crypto analyst Ali Martinez on X points out the chart, which exhibits that the current hold of Binance users on open Dogecoin (DOGE) positions is 72.13% long, with only 27.87% short. The overwhelmingly optimistic outlook was emphasized by Martinez.

This significant leaning long indicates that the majority of market participants expect further upside in the short term for Dogecoin. Such a skew reveals rising confidence in the token’s momentum, and more traders are anticipating gains. In keeping with its history of triggering high enthusiasm among retail investors and large speculators, Dogecoin’s bullish tilt is in step with previous market behavior.

However, this level of imbalance has its risks. The data could be viewed in one way as a possible sign of strength but a market strongly positioned in one direction may be susceptible to flip-flops. Such a sharp decline in the broader crypto market, or for Dogecoin in particular, can lead to a cascade of liquidations of leveraged long positions. When the dip happens in such circumstances there is quick escalation. Traders rush to exit and quickly accelerate downwards momentum.

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Muhammad Ali
Muhammad Ali
Muhammad is an experienced crypto-journalist. After five years in the field, he has become a respected authority on several top tier crypto media platforms. As a journalism and finance graduate, he plans to capture the world’s progress toward crypto and fintech industry.

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