Why is Dogecoin (DOGE) price falling?

DOGE is pulling back after reaching its highest levels since May 2021. The decline in DOGE price may be due to traders taking profits following Donald Trump's win.
DOGE price fell 14.25 percent from its local high of $0.480 to $0.41 on November 25. The correction for the largest memecoin came after the RSI indicator remained above 70, considered an “overbought” area, for more than two weeks.
The RSI crossing into this zone indicates that DOGE is experiencing a strong upward momentum and the price rose excessively during the rally.
The last RSI peak at 77.45 was recorded as a lower peak compared to the 92.45 peak on November 13. During the same period, Dogecoin increased by over 22.65 percent and reached over $0.45.
Although the RSI indicator is recording lower peaks, the price seeing higher numbers means that the momentum is weakening.
So, even though the DOGE price is rising, the declining strength of the RSI indicates that fewer buyers are entering the market and buying pressure is decreasing in the short term.
Bitcoin, which cannot exceed 100 thousand dollars, limits Dogecoin
Dogecoin price drop, Bitcoin
BTCUSD
It parallels the overall decline caused by the retreat from the $100,000 edge.
BTC price fell as much as 4 percent after reaching $99,800 on November 22. This led to crypto market liquidation worth approximately $490 million in the last 24 hours. This was the highest figure seen over a weekend in more than half a year.
While long and short positions lost $360.44 million and $128.93 million, respectively, the most liquidation occurred in altcoins.
The Dogecoin futures market witnessed liquidation worth $31.72 million, while longs lost approximately $21.72 million.
Large liquidations indicate that many investors are overly optimistic about DOGE's price and expect it to continue rising.
Traders were caught off guard as the overall market, including Bitcoin, pulled back and liquidations increased the pressure on DOGE.
DOGE price is seeking a 30 percent rise
The correction in Dogecoin price is occurring after the price tested the upper trend line of the ascending triangle (~$0.44) as resistance.
An ascending triangle occurs when the price moves between a flat resistance level and a rising trendline support, and if the price successfully breaks above the resistance, it usually signals a continuation of the main uptrend.
As a technical rule of thumb, the potential price target after the breakout is calculated by adding the triangle height (the distance between the first resistance and the first low) to the breakout point.
However, a confirmed daily close above $0.44 accompanied by a significant increase in trading volume could confirm a bullish breakout. In this scenario, the DOGE price is likely to reach the formation target of $0.56 with a 30 percent increase.
Conversely, a pullback from the upper trendline of the triangle could sink the DOGE price towards the lower trendline target of around $0.40.
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