Dogecoin
Dogecoin, the largest so-called meme coin by market capitalization, had an ugly June. The cryptocurrency dropped more than 22% from just above $0.086 to close out the month just under $0.067. But that headline figure masks significant volatility.
DOGE/USD was at one point down as much as 40% when it briefly dipped below $0.05 in mid-June. It has since recovered about 33% from these levels. At one point last week, Dogecoin looked like it might recoup the entire month’s losses, but the cryptocurrency ran into resistance in the form of a downtrend from mid-May just before it tested the $0.08 level.
The 50-Day Moving Average also contributed to capping Dogecoin’s gains last week. The cryptocurrency has since slipped back to trading just above its 21DMA (currently at $0.063).
As July gets underway, Dogecoin is looking bearish both on the short and long-term time horizons. The recent rejection of the 50DMA and downtrend suggests that the cryptocurrency’s near-term momentum will likely carry it back lower again towards recent lows around $0.05.
If Dogecoin was able to muster a bullish upside break above this key area of short-term support, that could certainly open the door to a run higher towards $0.10 and beyond. But the cryptocurrency remains in the grip of a downtrend that has been in play for the whole year so far, suggesting any break into the upper-$0.10s is unlikely.
Assuming there isn’t a massive, broad pick-up in macro risk appetite that sends cryptocurrencies lurching higher, Dogecoin’s next stop will likely be $0.05 rather than $0.10. That assumption shouldn’t be taken for granted, however.
US inflation data last week indicated a slowdown or peaking of US price pressures, while other data indicated weakening growth momentum. Markets have been paring back on Fed tightening bets as of late and this has led to a collapse in US bond yields.
For now, worries about a potential recession are weighing on risk assets like crypto. But if markets start believing that the Fed is going to start easing rates significantly in 2023 and beyond, risk assets could be in for a rally between now and the rest of the year.
Shiba Inu
June was an erratic month for the crypto community’s second favorite meme coin Shiba Inu. SHIB/USD ended the month with losses of just shy of 12% just above the $0.000010 level. But the memecoin was at one point nearly 40% down on the month when it fell into the low-$0.000007s.
Equally, SHIB/USD was also at one point trading with monthly gains of about 4% when it rallied towards $0.000011. Over the past few days, the cryptocurrency has been consolidating between its 21 and 50-Day Moving Averages at $0.0000095 and $0.0000105 respectively.
SHIB/USD pivoted on either side of a key long-term level of support just under $0.000010 last month. This level was (roughly) the top of Shiba Inu’s trading range during the summer of 2021.
Long-term technicals suggest that while there is room for a near-term rally, perhaps as high as resistance in the $0.000017 area, Shiba Inu’s trend remains bearish. The cryptocurrency has been locked within a downtrend since the beginning of 2022. Since the start of the year, SHIB/USD has fallen by around 70%.
If it does eventually fall towards the summer 2021 lows around $0.000005, that would mark a more than 85% drop on the year. If upcoming US (and global) data this month indicates the toxic combination of a further build-up of inflationary pressures plus more weakening of growth, then macro (and crypto) risk appetite may continue to deteriorate, sending Shiba Inu towards this area.
BabyDoge
BabyDoge, the third-largest meme coin by market capitalization and the self-proclaimed offspring of Dogecoin, also had a choppy month in June. The cryptocurrency reached as high as $0.0000000025 (that’s right, eight zeros) on 1 June before subsequently collapsing as low as $0.0000000011 by the middle of the month.
At this stage in its life, BabyDoge’s price action is mostly going to be determined by the whims of retail trader emotions and the cryptocurrency’s efforts to build up notoriety. In that regard, the BabyDoge community has been doing well.
The official BabyDoge Twitter page has 1.4 million followers, its official Instagram page has 283K followers, and its Telegram channel has over 200K members (according to CoinMarketCap). Out of the non-Dogecoin/Shiba Inu meme coins, this already strong community suggests BabyDoge has a chance of making it big.
Retail crypto investors may be attracted to the BabyDoge’s deflationary tokenomics and redistributive transactions tax that offers token holders a passive stream of income. If BabyDoge’s developers can deliver some meaningful utility to the token via NFT creation and GameFi, then the meme coin certainly has the potential to rally in the next crypto boom. For now, price action is likely to remain highly choppy.
