Dogecoin (DOGE) is facing another round of bearish pressure, aligning with the general cryptocurrency market narrative, with a trading expert warning of more losses for the top meme coin.
The potential drop stems from a technical formation where DOGE is experiencing a bearish crossover between the Market Value to Realized Value (MVRV) Ratio and its 30-day Simple Moving Average (SMA). Historically, this has signaled downward pressure, according to prominent trading expert Ali Martinez in an X post on February 2.
The MVRV Ratio is a key metric to assess whether an asset is overvalued or undervalued relative to its realized price. When the ratio crosses below its 30-day SMA, it often suggests that holders are entering a period of profit-taking, leading to increased selling pressure.
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“DOGE just experienced a bearish crossover between the MVRV Ratio and its 30-day SMA, signaling a steep price correction ahead,” Martinez stated.
Initially, in another X post on February 1, Martinez suggested that Dogecoin would likely drop to $0.20, observing that it followed a similar pattern to Pepe (PEPE). Based on the four-hour chart, Dogecoin appeared to mirror PEPE’s recent price drop.
At the time, Martinez emphasized that the $0.31 support level was crucial to avoid further declines. If this support fails, historical price action indicates that DOGE could see a deeper correction toward $0.20, aligning with PEPE’s recent trajectory.
Dogecoin’s potential recovery path
Meanwhile, pseudonymous trading analyst Trader Tardigrade suggested that Dogecoin’s downturn might not last long.
According to the expert, DOGE might be gearing up for a bullish turnaround, as the meme cryptocurrency shows a bullish divergence on its daily Relative Strength Index (RSI).
Despite DOGE forming a new lower low in price action, the RSI indicator is printing a higher low, signaling that downside momentum is weakening and a potential trend reversal could be on the horizon.
Historically, such divergences often precede an upward move as selling pressure subsides and buyers step in. As reported by Finbold, Trader Tardigrade initially stated that DOGE has the potential to spike by about 3,000%, given historical setups.
In general, Dogecoin is experiencing notable capital outflows as cryptocurrency markets continue to be impacted by uncertainties stemming from the DeepSeek sell-off. Additionally, there is uncertainty in the market following President Donald Trump’s announcement of a 25% tariff imposition on goods from Canada and Mexico. The drop in DOGE has largely been led by Bitcoin, which lost its $100,000 support level.
Indeed, Dogecoin has also failed to react to bullish news surrounding the token. Specifically, there was anticipation of a DOGE rally following Grayscale’s launch of a Dogecoin Trust, which has increased institutional interest in the coin.
The potential influx of institutional capital from such an investment product is vital in helping the meme coin move toward the $1 mark.
DOGE price analysis
As of press time, DOGE was trading at $0.30, having plunged by over 8% in the last 24 hours, while on the weekly chart, the token is down 10%.
As things stand, Dogecoin investors should anticipate further downward momentum, considering the asset’s technical setup for the short term remains bearish. For instance, the price is below the 50-day SMA ($0.3513) but remains above the 200-day SMA ($0.2247), indicating long-term support.
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