Dogecoin (DOGE) has experienced a sharp decline, falling over 4% in the last 24 hours to trade at $0.163 as of March 31. This drop comes as part of a broader downturn in the memecoin sector, with technical indicators suggesting further losses ahead.
Dogecoin Drops 20% in Four Days
Between March 27 and March 31, DOGE has lost 20% of its value, underperforming most of the cryptocurrency market. A significant factor behind this decline is a statement from billionaire entrepreneur Elon Musk, clarifying that the US government has no plans to integrate Dogecoin into its operations.
Musk’s influence on Dogecoin is well-documented, and speculation around government adoption had previously fuelled optimism among investors. However, his latest comments have led to disappointment and selling pressure.
Memecoin Market Faces Widespread Losses
Dogecoin’s decline is part of a broader trend affecting the memecoin sector. Other prominent memecoins have also recorded losses, with Shiba Inu (SHIB) down 4.2% in the last 24 hours, trading at $0.00001206. Meanwhile, Ethereum-based Pepe (PEPE) fell 1.7%, and Solana-based Fartcoin (FARTCOIN) saw the most significant drop, losing 8% to trade at $0.4146.
24-hour performance of top-cap memecoins: Source: CoinMarketCap
Market data suggests that the total daily trading volume in the memecoin sector has decreased by 48% over the last month, highlighting a decline in investor interest. This shift coincides with growing macroeconomic uncertainties linked to trade policies under former President Donald Trump, which have driven traders away from riskier assets.
Elon Musk Denies US Government Dogecoin Adoption
One of the biggest catalysts for Dogecoin’s decline has been Elon Musk’s clarification regarding its role in government policy. Speaking at a town hall in Green Bay, Wisconsin, on March 30, Musk, who leads the Department of Government Efficiency (D.O.G.E.) under the Trump administration, stated:
“There are no plans for the government to use Dogecoin or anything as far as I know.”
Despite the department’s acronym matching that of the cryptocurrency, Musk emphasised that there was no connection, explaining that the name stemmed from online suggestions rather than any intention to integrate Dogecoin.
Many investors had speculated that Musk’s role in government could lead to official recognition or use of the memecoin. His denial has dashed these hopes, contributing to the recent price drop.
Technical Analysis Signals Further Downside
Technical indicators suggest that Dogecoin could see further declines in the coming days. The cryptocurrency has confirmed a bearish flag pattern on the daily chart after falling below the key support level of $0.1773.
Currently, DOGE is testing support at $0.160. If selling pressure continues, the next key levels to watch include:
$0.1427 – a previous range low reached on March 11
$0.1275 – a significant support level from October 25, 2024
A strong move below these levels could trigger additional losses. Technical projections suggest a possible drop to $0.0876, representing a further 42% decline from current levels.
The Relative Strength Index (RSI) has also fallen from 52 to 38 since March 26, indicating increasing bearish momentum. Crypto analyst Andrew Griffiths commented:
“Dogecoin exhibits bearish momentum. The price is likely to stabilise below the pivot line at 0.1774, paving the way for potential declines to 0.1478 and 0.1283.”
Griffiths further warned that a daily close below $0.1283 could confirm a continued downtrend, potentially pushing the price toward $0.0850.
Market Outlook
With DOGE and the broader memecoin market facing significant selling pressure, investors remain cautious. The lack of positive catalysts, combined with technical indicators pointing to further declines, suggests that Dogecoin’s downward trend may continue in the short term.
For now, traders are closely watching key support levels to assess whether the market can stabilise or if further declines are ahead.
