Dogecoin (DOGE) and Bonk (BONK) Experience Price Dip as Market Experts Suggest Corrections Tend to Follow Memecoin Rallies

Santiment, a market intelligence platform, reports a notable increase in discussions surrounding memecoins like Dogecoin (DOGE) and Bonk (BONK). This surge occurred as

Binance Chain derivatives exchange Santiment reported on Monday that discussion around memecoins has increased as the surge in memecoins such as Dogecoin (DOGE) and Bonk (BONK) coins has raised concerns.

However, market experts say that markets tend to correct when the focus shifts from primary tiers to more speculative assets such as memecoins.

Yesterday, discussions about memecoins increased significantly as coins such as Dogecoin and Bonk Coin surged.

Typically, markets correct due to greed when the focus shifts from primary tiers to more speculative assets. Today, unsurprisingly, the entire market is down.

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Dogecoin Price Drops

Dogecoin price is $0.127748 with 24-hour trading volume of $1.39 billion. DOGE has lost 1.07% in value over the past 24 hours, giving it a market capitalization of $18.7 billion. Despite the drop, Dogecoin continues to have a strong presence in the market, with a circulating supply of 146.4 billion DOGE coins.

Additionally, Dogecoin’s relative strength index (RSI) is at 69.17, which is close to the overbought level of 70. This indicates that the coin is approaching a critical point where a price correction is possible. However, there is still room for the price to rise as the RSI is just below 70. Market participants should pay close attention to any signals that market momentum is waning.

Additionally, Moving Average Convergence Divergence (MACD) analysis shows diminishing bullish momentum. The MACD line crosses below the signal line, indicating a possible trend reversal or consolidation phase. While the histogram remains in slightly negative territory, indicating a decrease in upside momentum, traders should proceed with caution.

Dogecoin derivatives show mixed signals

Dogecoin derivatives also present a complicated situation. Volume fell 28.05% to $2.61 billion, and open interest fell 4.12%. However, options trading surged by 542.20% and open interest increased by 46.08%, indicating an increase in speculative activity. Long positions continue to dominate exchanges like Binance and OKX, reflecting the overall bullish sentiment.

Short positions have experienced significant liquidation, but long liquidations have also increased over the past 12 hours. The market remains active, with traders balancing long and short positions and engaging in options trades.

Bonk faces market cooling as traders take bearish stance

As of press time, the value of BONK is also showing signs of cooling, sitting at $0.000023. Bonk is down 9.59% in the past 24 hours, while its trading volume has reached $263 million, with a market capitalization of $1.67 billion and a circulating supply of 74 trillion BONK coins.

Also, Bonk’s RSI is at 55.12, indicating neutral to slightly bullish sentiment. Despite the price decline, momentum has not yet shifted into oversold territory. This suggests that the recent downward trend may soon stabilize.

Similarly, the MACD indicates mild bullish momentum, the lines are converging, and the histogram shows a weakening uptrend. If these indicators continue to weaken, traders should remain cautious as the market may turn bearish.

Bonk derivatives show bearish trend

Bonk’s derivatives market reflects a more bearish sentiment. Volume fell 21.58% to $9.863 billion, while open interest fell 11.90% to $933 million. The long/short ratio is 0.8932, indicating a slightly bearish trend in the market.

Nonetheless, Binance’s long/short ratio stands at 1.31, showing that traders on the exchange are more optimistic. Notably, there has been massive liquidation of long positions over the past 12 hours, which increases the likelihood of a market correction.

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