Dogecoin Loses $1 Billion of its Market Cap in a Day
Leading meme token Dogecoin (DOGE) had already been experiencing a sell-off in the last few days and it appears to have extended it.
DOGE saw a significant amount of capital outflow and the price of the asset plunged below the key bullish trendlines.
Market cap
At the time of writing, the market capitalization of Dogecoinstood at $11.7 billion, which means that the last 24 hours have seen a total capital outflow of about $1.15 billion.
On December 11th, Dogecoin was at the eighth position in crypto rankings because it had a total market cap of about $12.85 billion.
Even though there is no specific reason for the ongoing sell-off that Dogecoin is experiencing, it seems that the asset is also dealing with the impact of the general correction taking place in the crypto market.
There were a number of assets that started the week on a negative note, as they lost all the possibility of sustaining the bullish trend that had been seen in the last few days.
Price analysis
The price of Doge had come down to $0.08 at the time of writing, which means the last 24 hours had resulted in a price correction of about 9%.
The weekly chart of the cryptocurrency shows that it has lost almost 15% to 16% of its value. Taking its existing price into account, the meme token is dealing with a resistance level of $0.95.
If the decentralized finance (DeFi) token is able to breach that particular level, it will also be able to reclaim the $0.10 zone, where more work will be required by buyers and bulls for sustaining their gains.
Nonetheless, it should be noted that there is still a risk of further correction in the price of DOGE, if it goes below the support level of $0.080.
Failure to sustain gains
While the meme asset has been trading well below the highs it had reached last year, it should be noted that Dogecoin still remains one of the most prominent assets in the ongoing market correction.
But, the asset did manage to relieve some of the pressure when Tesla’s CEO, Elon Musk, who is a huge Dogecoin fan, acquired Twitter.
After the acquisition, there has been speculation that Dogecoin will be integrated as a payment option on the social media platform.
There was buying pressure after the acquisition and a report on December 2nd showed that there had been an inflow of about $5 billion in Dogecoin’smarket cap in a period of five weeks.
While the correction has been happening, the meme currency has also seen some interest from investors, particularly from the United States and this has contributed to its demand.
For now, the Dogecoin community appears to have a bullish approach, especially as there are rumors that Elon Musk will work with VitalikButerin, the Ethereumco-founder, for the development of the meme token.
Dogecoin has also taken a hit from the fallout of the crypto exchange FTX’s collapse, so it may take time to recover.
