The Dogecoin price declined sharply on Sunday, a day after it surged to an all-time high of $0.7370. On Sunday afternoon, DOGE was trading at $0.4900, which was more than 30% below its ATH. According to CoinMarketCap, the currency has a market cap of more than $64 billion, making it the fourth-biggest digital currency in the world after Bitcoin, Ethereum, and Binance Coin.
Dogecoin price is down by 31% in the past 24 hours
The background: Dogecoin was in the spotlight last week as investors focused on Elon Musk, the CEO of Tesla and SpaceX. Elon is the second-richest person in the world after Jeff Bezos. According to Bloomberg, he has a net worth of more than $184 billion. This year alone, he has added more than $14 billion to his net worth. This performance is partly because Tesla has done relatively well and SpaceX recently raised $374 million at a valuation of more than $75 billion. Tesla shares have also surged, partly because the company has invested in Bitcoin.
What happened: On Saturday, Elon Musk hosted the Saturday Night Live (SNL), a popular comical program. Before the episode aired, there was optimism that the so-called DogeFather will talk about Dogecoin. In most cases, cryptocurrencies and other assets tend to surge in anticipation of a major event. Indeed, in April, Bitcoin price surged to an all-time high as investors anticipated the Coinbase Global direct listing.
Buy the rumour, sell the news is also common after a major event. In fact, this is why the Dogecoin price is down by more than 30% today. It is also why the Bitcoin price crashed by more than 20% after the Coinbase listing. So, what next for DOGE?
The DOGE price has been in a bullish trend in the past few days. The currency formed a double-top pattern that is shown in black. Its neckline was at $0.5158. In technical analysis, a double-top pattern is typically a bearish sign that leads to further losses. The currency has also moved below the 25-day and 50-day moving averages while other popular oscillators have turned south.
Therefore, since there is no major catalyst ahead and the fact that Dogecoin has no major utility, I suspect that the currency will continue dropping as bears target the next key support at $0.35, which is about 27% below the current level.