Dogecoin (DOGE) prices jumped by nearly 40% on a 24-hour adjusted timeframe on Wednesday, shaking out more than $16 million worth of bearish leverage in just one hour while almost reclaiming its pre-crash high.
Leveraged bearish traders caught themselves on the wrong side of trading after Coinbase Pro, a United States-based crypto trading platform, announced that it would enable DOGE trading to its portal from Thursday.
“Starting immediately, we will begin accepting inbound transfers of DOGE to Coinbase Pro,” Coinbase confirmed in its blog post.
“Once sufficient supply of DOGE is established on the platform, trading on our DOGE-USD, DOGE-BTC, DOGE-EUR, DOGE-GBP, and DOGE-USDT order books will launch in three phases, post-only, limit-only and full trading.”
The news prompted a sudden overnight spike across DOGE spot markets, burning speculators who had placed bets on the cryptocurrency’s price decline.
A bored market gravitates to $DOGE.
— Hsaka (@HsakaTrades) June 2, 2021
Spot volume dominance (orange) compared to rest of the alts (blue) on Binance spot. pic.twitter.com/PlkdOJkf0V
The DOGE/USD exchange rate rose by up to $0.064, or 17.34%, after opening Wednesday in green. The pair reached an intraday high of $0.454 before witnessing a minor downside correction led by profit-takers. As of 12:07 UTC, DOGE was changing hands for $0.434.
Dogecoin also fared well against its top rival asset, Bitcoin (BTC). The DOGE/BTC exchange rate jumped 33% in the previous 24 hours, wiping all the losses that it had incurred against Bitcoin during the May 19 crash.
The past 24 hours witnessed Dogecoin short liquidations worth $47.83 million.
Bullish calls resurface
Dogecoin’s latest move uphill also prompted observers to predict a $1 valuation in the coming sessions, a level DOGE/USD missed after peaking out at $0.76 on Binance.
For instance, Primordial Hashrate, a crypto-focused newsletter service, cited Dogecoin’s Relative Strength Index (RSI) — a technical indicator that charts an asset’s current and historical strength or weakness — as its signal to bid DOGE/USD toward $1.
$DOGE has picked up huge buys on the RSI buy zone.
— Primordial Hashrate ❗ (@prhashrate) June 2, 2021
2. Is the next buy zone resistance for $Doge.
$1 incoming.. pic.twitter.com/xllZnOJl7t
Ronnie Moas, founder of Standpoint Research — a Miami-based financial research startup — noted that Dogecoin’s addition on Coinbase Pro, a platform most popular among professional crypto traders, would open DOGE to “million more investors worldwide.”
Massive bubble
Dogecoin grew into traders’ conscience primarily after it received backing from Elon Musk. The Tesla founder and CEO posted tweets in support of Dogecoin insofar that he ended up calling himself “the Dogefather” in jest, while also recently stating that he’s “Dogecoin’s master.”
Musk’s popularity became instrumental in pushing the DOGE/USD bids up by more than 15,300% in 2021, with its market capitalization hitting $92 billion, surpassing even Airbnb and Infosys.
Found this pic of me as a child pic.twitter.com/hUEKluRAdP
— Elon Musk (@elonmusk) June 2, 2021
But the supersonic price rally has also invited fear, uncertainty and doubt, or FUD, of a potential bubble. The panic almost engulfed the market after Musk called Dogecoin a “hustle” during his television appearance on Saturday Night Live on May 8, leading to a 45% price decline in the next three daily sessions.
The sell-off intensified further on May 19 amid a market-wide brutal sell-off. Dogecoin fell to as low as $0.29, down more than 74% from its all-time high of $0.76. Pseudonymous analyst the Asian Investor noted that Dogecoin is in the third stage of a “massive bubble” — the hype stage — that would soon follow up with deflation and panic-selling phases. He added:
“All hypes end. When this hype is over, people will look back on Dogecoin and wonder how wealth could have ever been created out of nothing.”
Dogecoin has rebounded by almost 132% after bottoming out at $0.29.