3 reasons Dogecoin is up 123% this week, hitting 10 cents for the first time

Thursday 15 April 2021, 9:02 PM AEST - 2 months ago

The price of Dogecoin (DOGE) has rallied by more than 123% this week, hitting new all-time highs of $0.13 on strong technical momentum.

DOGE/USDT 4-hour price chart (Binance). Source: TradingView.com

It has been competing against Chainlink (LINK) for the top-ten spot with both cryptocurrencies hovering at around $17 billion in market capitalization.

There are three major reasons why DOGE saw a steep climb over the past seven days. These include Elon Musk's tweets, the resurgence of altcoins, and the positive sentiment around crypto in general.

Altcoin market rallies strongly with positive sentiment

Throughout the past week, many of the "OG" altcoins, such as XRP, Tron (TRX), and Stellar (XLM), saw massive rallies following Bitcoin's (BTC) upsurge to a new all-time high above $64,000.

XRP, for example, broke above $1.5 for the first time in over three years, showing that profits from Bitcoin and Ethereum (ETH) are possibly cycling into altcoins in the short term.

Kelvin Koh, a partner at Spartan Group, one of the largest DeFi-focused funds in Asia, explained that this trend happens periodically because quant funds trade the convergence between Bitcoin and altcoins

Koh noted:

"The reason this happens periodically is because there are a bunch of quant funds out there that play the convergence trade between $BTC and a handful of liquid alts. Whenever there alts look cheap relative to $BTC, they pile in. When they look expensive, they rotate back to $BTC. No fundamentals involved so dont try too hard to rationalize the moves. This strategy has proven effective over time and there are enough managers playing this that it becomes self-fulfilling and keep recurring."

The general increase in the momentum of the altcoin market played a major role in fueling Dogecoin's overall momentum throughout the past few days.

Technical traders have echoed a similar se ...

Read full story on Cointelegraph

Disclaimer: The content and views expressed in the articles are those of the original authors own and are not necessarily the views of Crypto News. We do actively check all our content for accuracy to help protect our readers. This article content and links to external third-parties is included for information and entertainment purposes. It is not financial advice. Please do your own research before participating.