Dogecoin price resumed its downward trend on Wednesday as the mood in the crypto industry darkened. DOGE dropped more than 4% Wednesday morning, consistent with the performance of Bitcoin, Ethereum, and BNB Coin. Dogecoin is now down nearly 50% from its highest point this year and remains 75% below its all-time high. Here are the three reasons why the token continues to lose ground among investors.

Competition from Other Meme Coins

Dogecoin has dropped due to the rising competition from newer meme coins like Pepe, Dogwifhat, Bonk, and Brent. These tokens have risen by more than 200% this year, making them top performers in the crypto industry.

This competition is reflected in the daily volume. Data shows that the volume of Dogecoin in the past 24 hours stood at $585 million, while its market cap was over $17 billion. Pepe, with a market cap of $4.36 billion, had a volume of $676 million. Similarly, Dogwifhat had a 24-hour volume of $587 million. This indicates that these newer tokens are seeing more demand from traders.

Crypto Fear and Greed Index Has Slipped

Another reason for Dogecoin’s decline is the increasing fear among investors. The closely watched fear and greed index has dropped to the neutral point of 48, down from the year-to-date high of 90.35. If this trend continues, it is likely to move into the fear zone.

In most cases, cryptocurrencies and stocks retreat when there is a sense of fear in the market. This fear is happening due to the lack of a major catalyst in the crypto industry.

Dogecoin Price Death Cross Nears

DOGE price is also retreating due to risky patterns that have formed. Technically, the coin is about to form a death cross pattern, which occurs when the 200-day and 50-day moving averages cross each other. If this pattern materializes, the coin’s sell-off will likely accelerate.

Further, past recovery attempts for Dogecoin have faced substantial resistance. In May, it faced strong resistance at $0.1750, and in June, the same happened at $0.1285. These bearish patterns have also occurred in Bitcoin, significantly impacting altcoins.

Bitcoin has formed a quadruple top pattern and moved below the 100-day and 50-day moving averages.

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