Why is Dogecoin price down today?

Dogecoin is underperforming its top-ranking rivals, having fallen over 6% in the last 24 hours to trade at $0.226.What to know:Dogecoin is still in a bull market correction after its 525%-plus rally between August 2024 and December 2024.The top memecoin established its second-highest price peak of $0.484 in December but has declined by more than 50% since.Dogecoin’s downturn today and in recent months mirrors the panic across the memecoin sector.DOGE’s technicals and onchain data hint at further declines.DOGE falls alongside other memecoinsDogecoin’s declines today are part of a broader bearish sentiment in the memecoin sector.Key takeaways:Shiba Inu , the second largest memecoin by market capitalization, was down 5.60% over the last 24 hours to trade at $0.0000151. Ethereum-based Pepe has dropped by approximately 7.25% over the same period.Solana-based Bonk (BONK) posted the most losses among the top-cap memecoins, dropping by 7.55%.This bearish performance has wiped out close to $4.11 billion from the memecoin market over the last 24 hours alone. The risk-off mode comes amid a series of rug-pull scams in the memecoin market. Key points: Onchain investigator ZachXBT reveals that North Korea’s Lazarus Group is likely behind some of the recent memecoin rug pulls on Solana.Investors who suffered losses in these rug pulls may be exiting meme tokens altogether.Memecoins thrive on hype and optimism, but a wave of scams can turn sentiment bearish.This could reduce speculative capital flowing into Dogecoin.Dogecoin network activity is decliningDOGE’s price decline today coincides with a sharp drop in network activity, which signals waning user engagement and reduced demand.What to know:Dogecoin’s whale transaction count (>1 million), at 66 in February, is now the lowest in four months.Dogecoin’s transaction volumes have declined simultaneously, i.e. less DOGE demand for transfers, payments, or trading.When transaction volumes drop, it often means fewer people are buying or moving DOGE, leading to weaker price support.If this trend continues, DOGE may struggle to gain bullish momentum unless new catalysts emerge.Declining Dogecoin OI and funding rates DOGE’s bearish performance on Feb. 24 has been preceded by a significant decrease in open interest (OI) and low funding rates.Dogecoin’s OI dropped to $2.21 billion on Feb. 24 from its peak of $5.42 billion from over a month ago. The weekly funding rate was positive at 0.0315%, but it is far below its December 2024 peak of 2.058%.The decline in OI and the low funding rate point to a bearish sentiment prevailing in the market. This indicates that Dogecoin traders are either taking a cautious approach or that the overall interest in trading DOGE with high leverage has diminished.DOGE’s price risks another 35% dropTechnical indicators now suggest that DOGE is approaching key support levels that could determine its next move.What to know:The 50-week EMA (the red wave) at $0.2197, which also coincides with the 0.618 Fibonacci retracement line, is serving as Dogecoin’s immediate support level.A break below $0.2197 could lead to a drop toward the 0.786 Fibonacci retracement level at $0.1459, down by over 35% from current price levels, by March.The downside target is closer to DOGE’s 200-week EMA (the blue wave) at around $0.1358, which previously acted as a breakout zone.The Relative Strength Index (RSI) is at 46.16, indicating neutral momentum.More downside is likely if the RSI drops below 40.To regain bullish momentum, DOGE must turn $0.2670 (0.5 Fib level) into a new support level.This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.