Dogecoin (DOGE) could soon see a significant price drop. A recent analysis shows that The price of Bitcoin is on the verge of a price correction, which will also lead to a downtrend for the leading meme coin.
Dogecoin drops along with Bitcoin
Dogecoin is expected to fall alongside Bitcoin as the latter eventually undergoes the massive price correction that crypto analyst Ali Martinez recently predicted that the flagship crypto could witness. In an X (formerly Twitter) afterMartinez indicated that the TD Sequential indicator on Bitcoin’s 2-month chart had given a sell signal in preparation for a price correction.
The crypto analyst further stated that Bitcoin could drop as low as $40,600 if the crypto fails to hold the $51,000 support level. This expected price drop for Bitcoin is also expected to lead to a price crash for Dogecoin due to the price correlation between both crypto assets. Facts of the market information platform IntoTheBlock shows that Dogecoin’s price correlation with Bitcoin is 0.9, indicating a strong positive price correlation.
Related reading: Dogecoin Hits ‘Second Low’ That Could Spark 4,000% Rally Above $4
Bitcoin, as a leading crypto, is also known to have a huge impact on the broader crypto market. As such, a price drop will undoubtedly translate into downward pressure for DOGE. It is worth noting that Dogecoin was one of the coins that saw the biggest price drop after Bitcoin crash on August 5 when the leading cryptocurrency fell below $50,000.
Meanwhile, a Bitcoin crash is likely due to the flagship crypto’s historical trend of posting losses especially in September. In addition to Martinez, other crypto analysts, such as CryptoQuant’s Head Of Research, Julio Moreno, have also predicted that the price of Bitcoin could plummet this month.
September was also not the best month for DOGE. Facts CryptoRank shows that the top meme coin has posted monthly losses in all but three months since 2014, with Dogecoin last ending September with a profit in 2021.
Onchain stats paint a mixed picture for DOGE price
Onchain Metrics are currently painting a mixed picture for Dogecoin, with some bullish and others bearish. There has been an increase in large Dogecoin transactions, suggesting that crypto whales are currently accumulating strongly. The imbalance between bid and ask volume is also bullish for Dogecoin.
On the other hand, the number DOGE addresses in the money is declining due to the meme coin’s bearish price action, especially as DOGE is still below the crucial $0.10 support level. Meanwhile, The adoption of DOGE has stagnated, indicating a lack of interest in the meme coin among new investors.
At the time of writing, Dogecoin is trading at around $0.09, up over 1% in the past 24 hours, according to facts from CoinMarketCap.
Main image created with Dall.E, chart from Tradingview.com