The meme coin party has quieted down. After a thrilling surge that rode the coattails of Bitcoin’s record-breaking run, Dogecoin (DOGE) and Shiba Inu (SHIB) are facing a reality check. Both popular tokens are in the red today as investors appear to be cashing in their recent gains, a classic case of profit-taking that has put the brakes on momentum.
The broader crypto market is holding its breath after Bitcoin soared to a new all-time high of $123.218 on Monday before taking a breather. This pause has sent ripples across the altcoin space, with highly volatile assets like DOGE and SHIB feeling the chill. Now, all eyes are turning to a major economic indicator that could decide the market’s next move.
The Inflation Wildcard
The main event this week is the release of the United States Consumer Price Index (CPI) data. In simple terms, the CPI measures inflation, and it has a major influence on investor sentiment. The market is anticipating a year-over-year increase of 2,7% for June, a step up from May’s 2,4% reading.
Why does this matter for your crypto?
• Higher-than-expected inflation could spook investors, leading them to pull money out of riskier assets like cryptocurrencies and into safer havens.
• A favorable, lower-than-expected number could boost confidence, potentially reigniting the rally and sending prices climbing once more.
This uncertainty is creating a tense atmosphere, prompting traders to secure profits rather than risk a potential downturn.
Dogecoin at a Technical Crossroads
Dogecoin, the original meme coin, is currently trading around $0,1912, down 3% on the day. Its price chart tells a story of a battle between buyers and sellers.
DOGE/USDT daily chart
• Key Support: DOGE is struggling to hold above its 100-day moving average, a technical support level around $0,1900.
• Major Resistance: The price is being capped by its 200-day moving average at $0,2025, a significant hurdle for bulls to overcome.
• Profit Pressure: On-chain data from Glassnode shows that over 104,5 billion DOGE tokens are currently in a state of profit. When so many holders are in the green, the temptation to sell and lock in those gains increases, putting downward pressure on the price.
If the selling continues, DOGE could find its next support near the 50-day average at $0,1819. However, some bullish indicators like the MACD suggest underlying strength remains, meaning a push above $0,2000 is still on the table if market sentiment improves.
Shiba Inu Follows a Similar Path
Shiba Inu is facing a similar scenario. The token is down over 2,5%, trading at approximately $0,00001292 after failing to hold support at the $0,00001310 level.
The next critical support level for SHIB investors to watch is its 50-day moving average, currently at $0,00001248. A drop below this point could signal further losses.
SHIB/USDT daily chart
Like Dogecoin, the MACD indicator for Shiba Inu remains bullish, offering a glimmer of hope. For the rally to resume, SHIB would need to reclaim lost ground and push toward its 200-day average at $0,00001450.
For now, the fate of both meme coins seems tied to external forces. The upcoming inflation data and Bitcoin’s next directional move will likely set the tone for the rest of the week.
Disclaimer: This article is for informational purposes only and should not be taken as financial advice. Always conduct thorough research before making investment decisions.
