The Dogecoin price correction extended all weekend long, teasing what the permanent fixture might be end of a powerful rally in the previous four weeks. The popular meme-based cryptocurrency fell to a low of $0.3431, retreating from a recent high of $0.4265. This 19.55% drop has sparked speculation on social media about the sustainability of the gains and whether the momentum that fueled the rise is actually fading.
This Dogecoin price drop can easily be attributed to a decline in interest among market participants. Feelings on social media, a key driver of Dogecoin’s popularity and price movements, is showing signs of weakness. However, according to one crypto analyst, Dogecoin still has room to run, especially when it comes to indicators surrounding its popularity.
Interest in DOGE has yet to peak
Despite his status as a major cryptocurrencyDogecoin’s price increase is mainly related to social sentiment among traders and not to any demand for the utility or its parent company. This dependence on sentiment creates a cyclical pattern: periods of heightened interest often lead to price increases, followed by inevitable corrections when attention begins to wane.
The last Dogecoin rally has happened caused by a broad interest connected to the American presidential elections, Donald Trump, Elon Muskand comic associations with the Department of Government Efficiency (DOGE). Social media played a major role in increasing this attention as mentions of Dogecoin increased dramatically across platforms. As it stands now, it appears that interest is starting to fade, with Dogecoin’s price correction well reflecting this trend.
According to crypto analyst Ali Martinez, who highlighted this trend on social media platform The analyst shared a graph showing social media interest in Dogecoin over time. While the recent rally has led to a spike in interest, it has yet to rival that of 2021. With this in mind, Martinez emphasized that the Dogecoin price has much more room to grow this cycle.
What’s next for the Dogecoin price?
Interestingly, the recent Dogecoin price surge and subsequent correction have led to the creation of a bull flag pattern on the 1-hour candlestick timeframe. This pattern, which is associated with a continuation of the prevailing trend, indicates that the Dogecoin price is about to break upwards and continue its rally. All that remains to happen now is for the Dogecoin price to close above $0.40, which could solidify the breakout from the bull flag. Ali Martinez indicates a price target in this case $0.85.
At the time of writing, the Dogecoin price is trading at 0.3691, meaning it has risen by around 7.6% since hitting the low of $0.343. The resumption of social interest towards 2021 levels would in fact trigger another surge in the Dogecoin price.
Featured image created with Dall.E, chart from Tradingview.com