The Dogecoin price continues to crash this year as fear spreads in the crypto market. The fear and greed index has plunged to the extreme fear zone, while most meme coins have plummeted.
There is a likelihood that the DOGE price will bounce back when the tariff tantrum ends and many investors buy the dip. Still, there are a few reasons why the Dogecoin price may not bounce back to $1 in 2025.
Dogecoin Price Path to $1 is Long
The first main reason why the Dogecoin price may not reach $1 this year is that the coin needs to rise sharply from the current level. On Friday, DOGE was trading at $0.1650, meaning it needs to surge by almost 600% to reach $1 this year.
Such significant moves are possible in the crypto industry, as seen with the surges in XRP and XLM in 2024. However, the Dogecoin price needs a clear catalyst, such as a potential DOGE ETF approval and robust inflows, to reach $1 this year.
On the positive side, as shown below, the DOGE price has formed a falling wedge pattern on the daily chart. This pattern comprises two falling and converging trendlines. In most cases, an asset tends to rise when the two lines approach their confluence level. In this scenario, the Dogecoin price may surge and retest the 2024 high of $0.4840.
Elon Musk May Leave DOGE
Another potential risk is that the Dogecoin project could be affecting Musk’s other businesses. The Tesla stock price has crashed, while his net worth has dropped by over $119 billion this year.
Musk has also faced personal attacks due to the cuts in government spending he has implemented. As such, Kalshi estimates that there is a 54% chance that he will leave the DOGE project. Such a move would have a psychological aspect and contribute to the DOGE price crash this year.
Stock Market Crash Could Hit Dogecoin Price
Further, there is a risk that the ongoing stock market crash could accelerate as the Nasdaq 100 index nears a death cross pattern. The crash is mostly due to Donald Trump’s tariffs. Analysts at Citi, Goldman Sachs, and HSBC have all lowered their S&P 500 index expectations for the year.
Another catalyst for the future sell-off will likely be the bursting of the artificial intelligence (AI) bubble. This is a notable event because the AI hype has helped to drive the stock market gains in the past few years.
Therefore, if the bubble bursts, it will likely affect the stock market. Stocks are correlated with cryptocurrencies, including Dogecoin and Bitcoin.
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