Dogecoin price tumbled towards $0.35 on Saturday, declined 6% in 4 consecutive days of losses. Market data analysis reveals 3 reasons DOGE struggles for traction since Trump launched official memes on the Solana blockchain.
Why Crypto Traders are Crypto dumping Dogecoin (DOGE) at $0.40
Dogecoin (DOGE) price tumbled towards $0.35 on Saturday, January 25, down 20% within the 7-day timeframe. Market data analysis reveals key reasons DOGE traders are taking on a bearish outlook this week.
Profit-Taking Following Trump’s Inauguration
Leading up to President Trump’s inauguration on January 20, 2025, DOGE saw a significant rally, surging from $0.10 to $0.40—a 300% increase.
This surge was largely driven by market optimism surrounding Trump’s pro-cryptocurrency stance and the appointment of Elon Musk to lead the newly established Department of Government Efficiency (D.O.G.E).
The inauguration served as a catalyst for profit-taking, with many investors liquidating their positions to realize gains, contributing to the recent price decline.
Dogecoin Price Action
DOGE price has experienced a 20% decline over the past week, trading around $0.35 as of January 25, 2025. This downturn coincides with the introduction of new memecoins associated with President Donald Trump on the Solana blockchain.2.
2. Emergence of Trump’s Memecoins on Solana
On January 18, 2025, President Trump announced the launch of the $TRUMP token on the Solana blockchain.
The token quickly gained traction, reaching a market capitalization exceeding $10 billion shortly after its release.
Trump Launches Official Memecoins, January 20 | Source: X.com
The rapid ascent of $TRUMP and similar tokens has diverted investor attention and capital away from DOGE, leading to decreased demand and downward price pressure on Dogecoin.
3. Concerns Over Political Associations
The establishment of the Department of Government Efficiency (D.O.G.E) and its association with Dogecoin has introduced political considerations for investors. Some market participants are cautious about potential regulatory scrutiny or reputational risks stemming from the cryptocurrency’s perceived alignment with the current administration.
Speculators hint Elon Musk could deploy Dogecoin for D.O.GE | Source: X.com
Emphasizing this stance, after talks of Dogecoin logo on the official D.O.G.E website, speculations have emerged that Elon Musk might be considering untilzing the Dogecoin blockchain for some of the agency’s activity.
This apprehension has led certain investors to reduce or exit their DOGE holdings, further contributing to the recent price decline.
In summary, the combination of profit-taking post-inauguration, the rise of competing memecoins like $TRUMP, and concerns over political affiliations has collectively influenced Dogecoin’s recent market performance.
Dogecoin (DOGE) Price Forecast: Potential Drop to $0.31 Support
Dogecoin price forecast chart show that the memecoin currently trades at $0.359, posting modest 2.53% intraday gain. However, the technical indicators suggest a potential bearish shift in the near term.
The Keltner Channel highlights DOGE’s price struggling to reclaim the median band at $0.36, with the upper resistance at $0.42 remaining untested since the recent rejection.
The Parabolic SAR indicators remain above the price action, signaling bearish momentum dominance.
The recent 19.55% price drop over seven days reflects weakening buyer strength, as evidenced by declining volumes post-recovery.
Dogecoin Price Forecast | DOGEUSD
In a bullish scenario, DOGE would need to reclaim and sustain levels above $0.36 while breaking the upper Keltner Channel resistance near $0.42. A rise in RSI above 55.00 could signal renewed bullish momentum, driven by increased market interest.
However, in a bearish case, DOGE risks breaking below immediate support at $0.35, with a potential drop toward the critical $0.31 support. A further RSI dip below 50.00 would confirm overselling pressure, while decreasing trading volumes support this outlook.
The post Dogecoin Price Analysis: 3 reasons Crypto traders Dumped DOGE at $0.40 for Trump’s Solana memes appeared first on CoinGape.
