In a dramatic turn of events on the cryptocurrency market, Dogecoin and Shiba Inu have witnessed substantial price drops. These digital currencies, popular for their meme origins, plunged by 11% in tandem with a broader market sell-off triggered by Bitcoin's own significant decline. The downturn saw an unprecedented capital flight from Dogecoin, signaling a shift in investor sentiment and prompting concerns across the altcoin ecosystem.
Cryptocurrency Market Faces Steep Correction as Meme Coins Tumble
On Thursday, February 5, 2026, the cryptocurrency landscape was rocked by a sharp market correction, predominantly impacting meme coins. Dogecoin (DOGE) and Shiba Inu (SHIB) bore the brunt of this downturn, each experiencing an 11% fall in value. The catalyst for this market instability was identified as a colossal $29.67 million outflow from Dogecoin within a single day, marking one of its most substantial divestments in recent months. This exodus was exacerbated by Bitcoin's (BTC) own 10% crash, pushing the premier cryptocurrency below its crucial 1,000-day Exponential Moving Average (EMA) support level for the first time since 2023. This technical breach, historically indicative of a shift from bull to bear markets, instilled panic among investors, leading to a widespread sell-off in speculative assets. Market analysts noted a consistent lack of buying interest in Dogecoin, with its price now testing the lower boundary of its descending channel around $0.09. Should this level fail to hold, a further decline towards $0.07-$0.08 is anticipated, representing an additional 15%-20% downside. Similarly, Shiba Inu broke through its critical support at $0.0000086, now hovering precariously at the $0.000006 psychological support. A breach below this point could instigate a cascade of selling, pushing the token to $0.000005 or even lower. The Relative Strength Index (RSI) for SHIB, currently at 25.70, suggests it is approaching oversold territory, yet has not reached extreme levels. This period of market turmoil saw capital reallocate significantly, with investors favoring more traditional assets like AI stocks and precious metals, further draining liquidity from the volatile crypto space.
This recent downturn underscores the inherent volatility and interconnectedness of the cryptocurrency market. The significant outflows from meme coins like Dogecoin and Shiba Inu, coupled with Bitcoin's critical price movements, serve as a potent reminder for investors about the importance of diversification and risk management. The shift of capital into more conventional assets suggests a broader market sentiment leaning towards caution in the face of uncertainty. For the crypto community, this event could be a turning point, prompting a reevaluation of investment strategies and a deeper understanding of market dynamics beyond speculative trends.