Dogecoin price dips 10%! 3 reasons why now is the time to buy DOGE

Dogecoin price plunged 10%, nearing its lowest point from Q4 last year.
Memecoins have a unique allure that could help them thrive, even in tough markets.

In simpler terms, the recent drop in cryptocurrency prices erased the profits gained on meme-based coins like Dogecoin since early 2025. Notably, around 70 million Dogecoin tokens were added to Binance, which led to a succession of red candlesticks on the trading chart.

However, it’s important to note that while apprehension persists among investors due to market uncertainty, the allure of potentially high returns associated with memecoins might continue to attract those looking for swift, temporary profits.

Dogecoin is now showing a few signs pointing in that direction.

Watch closely: History might repeat itself

Looking back a week before Christmas 2024: The crypto market plummeted when the Federal Reserve decided against implementing interest rate cuts. This decision caused Bitcoin [BTC] to drop by 15% over the course of merely two weeks.

While altcoins followed suit, Dogecoin’s price took an unexpected turn.

Following reaching a peak of $0.48 in the early days of December, Dogecoin (DOGE) plummeted to $0.30 within only two weeks’ time. This downturn was evident in the DOGE/BTC pair, which turned red, indicating that investors were moving their funds towards other prominent altcoins.

In the midst of last week’s market downturn, I observed an unexpected surge in Dogecoin (DOGE) relative to Bitcoin. By the end of the first week of 2025, DOGE had managed to climb up to around $0.40. This trend suggested a sudden shift in investor behavior, as it seemed many were attracted to memecoins, seeking swift, short-term gains.

Currently, due to Bitcoin dropping by 8% following another unexpected move from the Fed, investors are keeping an eye on the possibility of it reaching around $90K. Such a dip might present another opportunity for Dogecoin to draw in investments, much like it did previously.

Although history may lean towards it, it doesn’t mean it will definitely happen. From a psychological perspective, Dogecoin might hold an advantage.

Though history suggests otherwise, it doesn’t ensure success. However, psychologically speaking, Dogecoin could be stronger.

Following some substantial market setbacks, it’s crucial that the potential return from Bitcoin investment surpasses the associated risks – at present, this balance appears to be tipped unfavorably.

Considering the recent 10% decrease in Dogecoin’s value, past patterns and the present market sentiment seem to indicate that now could be an opportune moment to begin stockpiling this cryptocurrency.

Let’s take a closer look at the on-chain data to see if it supports this theory.

Dogecoin price has strong potential

As a crypto investor, I’ve noticed that the recent surge of approximately $70 million worth of DOGE tokens into Binance coincides with its more than 10% decline over the past three days. This dip has effectively erased the gains we made on our investments earlier in 2025.

Nevertheless, the initial 18% jump up to $0.40 was primarily fueled by an enormous 400% increase in whale purchases.

This is a positive development, as the signs suggest further growth potential. With increased trading activity pointing towards an upward trend and the Moving Average Convergence Divergence (MACD) remaining bullish, we might witness more substantial buying activity over the next few days.

Regarding the Futures market, the Open Interest (OI) experienced a minor decrease of about 1.29%, landing at $3.43 billion. Despite this dip, long positions maintain an optimistic outlook for recovery. On the other hand, the majority of traders are adopting a bearish stance by shorting DOGE, which could be indicative of another bullish signal.

If whales re-enter the market, as appears quite probable due to the present circumstances, it might trigger a buying frenzy among traders, forcing them to purchase Dogecoin. This could further escalate Dogecoin’s price increase.

Read Dogecoin’s [DOGE] Price Prediction 2025–2026

Given past patterns, emotional influences, and data on trading volumes suggest a buildup of DOGE, it’s quite possible we might witness an increase in DOGE values within the near future.

To make this happen, it’s crucial that the risk factors in the market continue to be elevated, compelling investors to seek safety in memecoins such as Dogecoin.

2025-01-09 14:16

Watch closely: History might repeat itself

Dogecoin price has strong potential

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