Bitcoin and Dogecoin are two of the most watched cryptocurrencies this cycle, with increases in the Bitcoin price mostly flowing into that of Dogecoin. At some point, the price correlation between the Dogecoin price and that of Bitcoin was at 0.97.
Interestingly, recent market movements have seen the Bitcoin price returning above the $100,000 price level again, with the leading cryptocurrency reaching as high as 102,700 in the past 24 hours. However, this has yet to translate into a corresponding increase in the price of Dogecoin, with the meme coin breaking below support at $0.4 in the same timeframe.
Bitcoin has once again surpassed the psychological $100,000 threshold after a 7.5% price increase since a $94,900 low on December 10. Notably, this upward movement is the latest recovery for Bitcoin after a rejection at the $100,000 price level that sent shockwaves of liquidations among other cryptocurrencies.
But while Bitcoin has shown resilience, Dogecoin has faced notable challenges in sustaining its upward momentum. Dogecoin managed to rally to $0.48 on December 8, which is a level it hadn’t touched since 2021. However, a detailed examination of the meme coin’s price action reveals a recurring struggle with the $0.48 resistance level, which now seems to be the resistance level to break this market cycle.
At the time of writing, Dogecoin is currently trading at $0.395, meaning it has lost about 17% since it reached this 2024 high of $0.48. As it stands, Dogecoin is down by about 13% in the past seven days, making it the worst performer among the top 10 cryptocurrencies by market cap in this timeframe.
Market analysts have provided different predictions regarding the possibility and timelines of the Dogecoin price to achieve a new all-time high in the current cycle. ogecoin last reached its peak price of $0.73 during the crypto bull run of May 2021. The prospect of breaking above this level this cycle is still there, but the path forward appears challenging, especially if the Dogecoin price were to continue detaching from Bitcoin’s rally.
However, you could argue that the general consensus is for Dogecoin to resume its uptrend anytime soon. Historically, Dogecoin’s price surges have been due to sudden spikes in retail investor activity, often due to rumors on social media like payments on X and things of that nature. For Dogecoin to surpass its 2021 high, a similar wave of enthusiasm would need to emerge with significant trading volume and renewed interest from both retail and institutional investors.
As 2024 comes to an end, a more plausible scenario for Dogecoin to reach new highs might emerge in early 2025. By then, a change in the global economic and political landscape, including the inauguration of Donald Trump as president, could create optimism in the crypto sector.
Featured image from Bankrate, chart from TradingView
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