Dogecoin (DOGE) and Shiba Inu (SHIB) experienced price drops of more than 10% this week. The downward trend experienced by the latter coins is probably due to the macro side, which has sowed doubt in the minds of crypto investors.
The US Fed’s hawkish stance casts a shadow of doubt
Dogecoin and Shiba Inu are believed to have declined this week thanks to the US Fed’s stance on interest rate cuts. THE Consumer Price Index (CPI) inflation data was lower than expected, boosting the crypto market. However, the chairman of the Federal Reserve Speech by Jerome Powell highlighted the Fed’s hawkish stance, suggesting that the central bank was not yet seeking to cut interest rates.
His speech follows the US Fed’s decision to leave interest rates unchanged at between 5.25% and 5.5%. This development has weakened investor confidence in investing in risky assets such as cryptocurrencies. The crypto market, led by Bitcoin, experienced a decline following Powell’s speech, the flagship crypto rising from around $70,000 to $66,000.
Dogecoin and Shiba have had to bear one of the main consequences of this development, given that investors are more likely to invest in utility tokens rather than meme coins amid their fear that interest rates will remain unchanged throughout the year. Moreover, data from IntoTheBlock shows that major coins still correlate with the price of Bitcoin. As such, they are expected to decline significantly alongside the flagship crypto.
Shiba Inu’s decline is also believed to be due to the massive selling pressure the meme coin has been facing recently. Bitcoinist reported that Shiba Inu whales moved 4.29 trillion Shiba Inu tokens to Coinbase, a move that suggests these investors were looking to dump their Shiba Inu holdings soon enough.
Dogecoin and Shiba Inu will rebound
Crypto Analyst CrediBULL Crypto recently mentioned that Dogecoin had reached a “make or break” point. The analyst claimed that this was good for the meme coin as Bitcoin also simultaneously fell to its lowest level. He predicted that Dogecoin would rebound if Bitcoin benefits from a price reversal.
Kevin, crypto analyst (formerly Yomi OG) also suggested that Dogecoin’s chart was healthy and the leading coin was ready for an uptrend. This came after his revelation that the 12-day time frame on the Gaussian channel recently turned green on Dogecoin’s chart for the first time since December 2020. He said this indicates that an uptrend is on the horizon for Dogecoin.
Meanwhile, despite the selling pressure on Shiba Inu, the meme coin’s fundamentals paint a bullish picture, and it should not take long for it to register a price rebound. Data of Shibburn burn monitoring platform shows that the Shiba Inu’s burn rate has increased by more than 863% in the last 24 hours.
Featured image created with Dall.E, chart from Tradingview.com
