Winning The Meme Coin Rally: Why August Could Be Good For Dogecoin And Shiba Inu
The direction of Dogecoin and Shiba Inu are of high interest to crypto investors, given their roles as the two largest meme coins in the market. Often, the prices of Dogecoin and Shiba Inu rallying can signal a meme coin run that could send other meme coins higher. While both of these meme coins have struggled in the second quarter of the year, the third quarter may be shaping up to be more bullish.
Why Dogecoin Could See An Increase In Price
Using data from CryptoRank, we can see that the price of Dogecoin has struggled to hold gains over the last two months, seeing a 21.9% drop in price in June, with small gains of 4.24% gains so far in July. However, with the month of August coming around, there could be a turn in price.
One development that suggests that the Dogecoin price could go up moving into the new month is a surge in volume. According to data from the token tracking website CoinMarketCap, the Dogecoin daily volume surged more than 60% on Sunday to cross $1.22 billion.
With any coin, a surge in the trading volume of the coin suggests that attention is turning to that coin. In the case of Dogecoin, it could mean that the sell-offs which had sent the price back to $0.13 may finally be drawing to an end, and as a result, leaving room for the DOGE price to rally.
However, using historical data, a possible rally into the new month may not last long. In the decade that Dogecoin has existed so far, it has seen more bearish August months compared to bullish ones. So far, 60% of the August months have ended with losses, with only 40% ending in profit, with an average return of 0.83% and a median return of -5.17%. If this trend holds, then a rally would quickly die down, giving way for bears to reclaim control of the price.
Shiba Inu Has Better Prospects
Compared to Dogecoin, the Shiba Inu price may have better luck in the month of August. While its trading volume has remained muted, with only a 4% increase on Sunday, its average returns for the month of August remain higher than that of Dogecoin.
CryptoRank data shows that in the last three years, the Shiba Inu price has performed well in the month of August, bringing its average to 2.67% and a median of 3.36%. The SHIB price closed in the red last August with a 5.44% decline, but the possibility of a change has risen as its July losses have dropped to 2.76%.
Going by the average and median returns, then Shiba Inu could rise above $0.17 once again. However, just like the rest of the altcoin market, the direction in which Bitcoin swings will be a big determinant of whether August will be green or red.
Featured image created with Dall.E, chart from Tradingview.com
