Dogecoin and Shiba Inu prices have significantly crashed in the last 24 hours. This is partly due to Jerome Powell’s speech, which painted a bearish picture for crypto assets despite the announcement of a 25 basis point (bps) rate cut.
Why The Dogecoin And Shiba Inu Prices Crashed
The Dogecoin and Shiba Inu prices are both down over 5% in the last 24 hours. This price crash has happened despite the Federal Reserve announcing a 25 bps rate cut. One major reason for this price crash is believed to be due to Fed Chair Jerome Powell’s speech, which painted a bearish picture for these crypto assets.
Powell hinted in his speech that the Fed was currently ‘hawkish’ despite the 25 bps rate cut. He also suggested that there would likely be fewer rate cuts in 2025, having already made three rate cuts this year. The Fed being hawkish is bearish for the Dogecoin and Shiba Inu prices as investors become more skeptical about investing in these risk assets.
In Dogecoin’s case, crypto analyst Kevin Capital had mentioned that the meme coin’s technical indicators were currently bearish but added that it could be invalidated if the Fed took a dovish stance. However, that didn’t happen, meaning that the Dogecoin price could even plunge further, seeing as fundamentals and technicals are bearish.
Meanwhile, Powell’s take on the Strategic Bitcoin Reserve is another factor that could have contributed to the price crashes of Dogecoin and Shiba Inu. The Fed Chair mentioned that the US Central Bank is not allowed to hold Bitcoin and is not seeking a law change. That statement caused the price of Bitcoin to drop below $100,000.
The Dogecoin and Shiba Inu prices share a positive correlation with the flagship crypto, so it was expected that they would also follow suit as BTC corrected. If the Bitcoin continues to drop, then the Dogecoin and Shiba Inu prices are also at risk of further declines.
What Next For DOGE?
In a recent X post, Kevin Capital mentioned that the bias is to the downside in the short term for the Dogecoin Price. This came as he revealed that Dogecoin has witnessed seven straight candles in a row and failed to get above the Macro .786 Fib. The analyst added that DOGE is also losing the macro .5 Fib on the linear chart.
Meanwhile, Kevin also alluded to Bitcoin, considering the impact the flagship crypto could have on the Dogecoin and Shiba Inu prices by extension. The analyst stated that Bitcoin is getting rejected at the macro 1.703 level and printing a bearish daily candle while having a massive amount of long liquidity to the downside.
However, the analyst is confident these coins will still regain bullish momentum. He stated that people are overreacting to Powell’s speech and that the dip will be bought. In line with this, he remarked that this is a normal market correction.
Featured image created with Dall.E, chart from Tradingview.com
