Dogecoin has been performing great over the past week and became the fifth biggest cryptocurrency this past weekend. It is quite strange because Dogecoin is only a meme coin that does not have much going for it aside from the power of the meme, which is very powerful and worth about 50 billion USD.
With the current surge rate, Doge investors and spectators wonder if this might be the end of the road for the coin or if it can get up to a dollar.
Dogecoin is currently in sixth place; it is the sixth biggest cryptocurrency in the entire crypto space. It is up by over 300% in the past seven days; it is at 33 cents, but it almost got up to about 50 cents on Saturday. It also became the fifth biggest cryptocurrency and knocked Tether out.
Looking at the charts, you will see that we have had an incredible run-up; the RSI got up to about 96, showing that Dogecoin is overbought. You can see that every time it has happened before. We have massive pullbacks for Dogecoin. Recently, we saw an 80% pullback on the price, which was from the rally point towards the immediate bottom, then a few days later, 50% and 40% drawdowns.
What is interesting is that we have already seen a 50% drawdown which happened on Saturday.
Dogecoin tends to have these massive high pump cycles that come in and cool off very quickly, so one has to be very careful when trying to trade Dogecoin. You have to trade with caution, and if you are looking at it with the intention of long-term holding, the risks involved are high.
There seems to be a hype around Dogecoin which does not seem to make sense, and you do not need to understand; you only have to look at the reality of how the markets are reacting to the coin.
If you noticed the last two mega rallies for Dogecoin, they led to a long consolidation period. We may see something similar happening to Dogecoin this time where we will see a consolidation phase coming in and waiting for the next pump, which might take Dogecoin up to a dollar.
Dogecoin is pumping again because Elon Musk is tweeting about it. He is pumping it up with his meme power and incredible audience of about fifty-one million followers; maybe Dogecoin will be the first coin to go to the Moon itself. Slim Jim, the meat stock company, has also been tweeting about Dogecoin, going all-in on internet power.
Dogecoin is not a good cryptocurrency; it hardly has any developers, no ETFs, no Grayscale trusts, no company is buying it as a strategic asset. Despite how Elon Musk tweets about it, his company did not buy Dogecoin, but they bought Bitcoin. Retail investors are fueling the Dogecoin rally.
The Dogecoin rally shows the potential rally for altcoin; the fact that Dogecoin is pumping is a sign of hope for altcoins with potential.
