Peter Smith
Dogecoin (DOGE) might be heading for a price correction as technical indicators suggest the meme coin has become overbought following its impressive monthly run.
Dogecoin (DOGE) looks like it's running out of steam after an amazing 30-day rally that had everyone talking. The world's favorite meme coin is now flashing some warning signs that suggest the party might be coming to an end, at least for now.
According to CoinMarketCap data, DOGE has started pulling back from its recent highs. After climbing from $0.2582 all the way up to $0.2868, the coin is now showing classic signs of being overbought. Two key technical indicators - the Bollinger Bands and RSI - are basically screaming that things might have gotten a bit too hot.
DOGE Price Hits Overbought Territory
The numbers don't lie here. Dogecoin's RSI is sitting pretty at 80.56, which is way above the normal "overbought" level of 70. When you see RSI readings this high, it usually means buyers have been going crazy and a pullback is likely around the corner.
The Bollinger Bands are telling a similar story. DOGE's upper band is at $0.2751, the middle sits at $0.2050, and the lower band is down at $0.1349. With the price hanging out near that upper band, it's looking pretty stretched and ready for a breather.
Right now, DOGE is trading at $0.2644, down about 4% in the last 24 hours. Trading volume actually went up by 3.4% to $6.35 billion, which shows people are still actively trading despite the price drop.
DOGE Price Following Bitcoin's Lead
Dogecoin isn't alone in this pullback - the whole crypto market took a hit, dropping about 1.4%. Bitcoin fell 0.8%, and since DOGE tends to follow Bitcoin's moves pretty closely, that helped drag the meme coin down too.
This is pretty typical behavior for Dogecoin. When Bitcoin sneezes, DOGE usually catches a cold. The correlation between these two has been strong for a while now, so Bitcoin's weakness naturally spilled over to the meme coin space.
What's Next for DOGE Price?
Here's the thing though - before this recent stumble, Dogecoin was absolutely crushing it. The coin posted a massive 53% gain in the third quarter and was looking like it might finally break a six-year losing streak. That's a pretty big deal if you've been following DOGE for a while.
Even with this current dip, Dogecoin is still up a whopping 70.03% over the past 30 days. That rally started back on June 22, and it got some traders thinking DOGE could hit $0.40. Not bad for a coin that started as a joke, right?
The fact that trading volume is still decent suggests some investors think this might just be a temporary setback. Whether that optimism pays off depends on whether DOGE can hold key support levels and maybe catch another wave of buying interest.
For now, traders are watching to see if DOGE can bounce off that middle Bollinger Band at $0.2050. If it breaks below there, the next stop could be the lower band at $0.1349. On the flip side, getting back above $0.2750 would probably kill the bearish vibe and get people excited again.
Peter Smith
