Why is Dogecoin Drop? Here's Crypto Observer's Analysis

Bittime - Dogecoin price has fallen quite significantly in recent times. In the last 24 hours, the price of Dogecoin fell by more than 16%, raising the question: Why is Dogecoin down?

This article will take a deeper look at the causes of Dogecoin's price decline, the analysis provided by crypto observers, and its impact on the crypto market as a whole.

Why is Dogecoin Down?

Hangry Dogecoin experienced a fairly large decline since the beginning of 2025. Several key factors were the main cause of this decline. One of them is a significant change in on-chain metrics that gives a bearish signal. 

One indicator to pay attention to is the decline in the Market Value to Realized Value (MVRV) ratio which has exceeded the 30-day Simple Moving Average (SMA).

The MVRV metric itself measures the comparison between the current market price of Dogecoin and the average price when the coin was last moved. 

When MVRV falls below the 30-day SMA, it indicates that Dogecoin is considered overvalued, and investors who bought at high prices are starting to take profits. As a result, this triggered a decline in the price of Dogecoin.

Read also: List of Meme Coins that are Worth Buying in February 2025

Despite several price recovery attempts since the major declines in late 2024 and January 2025, Dogecoin has struggled to hold key Fibonacci retracement levels. 

Price movements fluctuating between the 76.1% and 140% levels indicate that there is weakness on the demand side, and investors are starting to hesitate.

Dogecoin Price Analysis

On February 2, 2025, Dogecoin was trading at around $0.23 (around IDR 3,750) per coin. With a market capitalization of $33.72 billion (around IDR 550 trillion), Dogecoin is still in a fairly good position in the crypto market. 

However, the recent downward price trend gives a warning signal to investors.

From a technical perspective, Dogecoin price movements tend to show weakness. This decline occurred amidst increasing bearish sentiment in the market, especially after the MVRV ratio indicated a possible trend reversal. 

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Analysts warn that if this trend continues, Dogecoin is at risk of further price decline.

However, there are also views that see this downturn as an opportunity for long-term investors. 

Dogecoin still has a large and loyal community, which is the main capital for its growth potential even though price volatility remains a challenge.

Latest Dogecoin Price

As of February 2, 2025, the price of Dogecoin was recorded at $0.23 (around IDR 3,750) per coin. In the last 24 hours, Dogecoin fell 24.48%, with trading volume reaching more than $9.2 billion (around IDR 150 trillion). 

Although it remains ranked eighth by market capitalization, increased selling pressure could affect Dogecoin's position in the market.

Fibonacci retracement levels are also increasingly difficult to maintain, indicating that if there is no significant recovery, Dogecoin price could move further down in the near future.

Read also: Dogecoin ETF and Its Impact on DOGE Prices

Conclusion

HDogecoin's price fell sharply indicating a bearish signal that investors should pay attention to. With MVRV showing too high a price and Dogecoin's inability to maintain important Fibonacci levels, further downside may be on the cards. 

However, Dogecoin still has potential for long-term investors thanks to its large and loyal community.

In the midst of the high volatility that is still inherent in the crypto market, it is important for investors to continue to monitor market developments and make investment decisions carefully.

FAQ

Why is the price of Dogecoin down?

Dogecoin fell due to changes in on-chain metrics, especially a decrease in the Market Value to Realized Value (MVRV) ratio, which indicates that the price of Dogecoin is currently overvalued and many investors are taking profits.

Will Dogecoin keep going down?

Despite continued selling pressure, Dogecoin still has a large fan base. However, if the bearish trend continues, Dogecoin has the potential to experience further declines.

How to predict Dogecoin price?

Dogecoin price predictions can be done by analyzing on-chain metrics such as MVRV, Fibonacci retracement, and also evolving market sentiment.

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Reference 

coinmarketcap, Dogecoin Coinmarketcap, accessed February 3, 2025.

DOGEHOME, Dogecoin Faces Price Drop as Key On-Chain Metric Turns Bearish, accessed February 3, 2025.

Author: Y