The Dogecoin and Shiba Inu prices have recorded significant losses this week, sparking a bearish sentiment towards the top meme coins. This price crash has come amid geopolitical tensions in the Middle East between Israel and Iran.
Why The Dogecoin And Shiba Inu Price Crashed
CoinMarketCap data shows that the Dogecoin and Shiba Inu prices have recorded significant losses over the last seven days. The price decline largely occurred on June 13 following Israel’s attack on Iran, which again escalated tensions in the Middle East. This development immediately sparked fear across the markets, sending the top meme coins spiralling.
The market further took a hit on the same day with Iran’s retaliatory strikes against Israel. Since then, both countries have continued to exchange fire, with blasts heard in Jerusalem and Tel Aviv. This has raised concerns that it could escalate into a full-blown war, which is bearish for the Dogecoin and Shiba Inu prices.
Moreover, Oil prices are skyrocketing as a result of the Israel-Iran tensions, which is also bearish for the top meme coins. Rising oil prices can cause inflation to rise, which will force the US Federal Reserve to either keep interest rates steady or even raise them. This Quantitative Tightening (QT) measure restricts liquidity flow and could negatively impact the Dogecoin and Shiba Inu prices.
Amid this price crash, Coinglass data shows that Dogecoin’s open interest has dropped by over 2% to $1.78 billion. This is bringing the meme coin close to its December 2024 lows when it crashed from its local high of $0.45. DOGE’s derivative trading volume has also crashed 37%, indicating a lack of interest in the meme coin among crypto traders. Most traders are also shorting Dogecoin at the moment, with the long-to-short ratio at 0.9.
CoinGlass data also paints a bearish picture for the Shiba Inu price. SHIB’s derivatives trading volume has crashed over 38% to $173 million. The long-to-short ratio is at 0.9, indicating that most traders are shorting the meme coin. However, the open interest is up almost 1% to $142 million, which is a positive for Shiba Inu.
DOGE And SHIB Could Reverse From Current Levels
Crypto analyst Trader Tardigrade suggested that Dogecoin may have bottomed at its current price level. In an X post, he stated that the meme coin reached the end of wave 4 corrective move, just before a huge move in wave 5. His accompanying chart showed that DOGE could rally above $0.65 on this move as it eyes a new all-time high (ATH).
Meanwhile, crypto analyst InvestingHaven recently made a case for the Shiba Inu price. In an X post, he noted that SHIB held its ultra-strong $0.000012345 level during key time windows, which aligns with the forecasted annual lows at $0.0000133. The analyst added that the chart now shows signs of a potential W-reversal and that a successful W-reversal could send SHIB to around $0.0000666.
Featured image from Shutterstock, chart from Tradingview.com
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