Since hitting its yearly high of $0.2288 on March 28, Dogecoin price has plummeted by over 54%. From its all-time high in May 2021, DOGE price has fallen by more than 85%. Despite this downturn, crypto analyst Cryptorphic (@Cryptorphic1) suggests that a bullish trend reversal could be imminent.
Cryptorphic has conducted an in-depth analysis of the weekly DOGE/USDT chart and believes that Dogecoin could see a significant price increase of 900%. This bullish prediction is backed by a combination of seven factors ranging from technical indicators to broader market trends.
What needs to happen for Dogecoin to skyrocket 900%?
The chart shared by the analyst shows Dogecoin’s performance since February 2021, which is confined within a tight channel. This channel was characterized by consistent lower highs and higher lows that formed a predictable pattern for over 1,127 days until a notable change occurred. Based on this, Cryptorphic reveals seven arguments for being extremely bullish on DOGE.
#1 Breakout above the accumulation channel
In the last week of February 2024, DOGE experienced a breakout marked by a massive candle that pushed it beyond the upper boundaries of this long-term channel. Following this breakout, Dogecoin entered a phase of retesting the upper boundary of the previous channel, a crucial phase to confirm the strength and potential longevity of the breakout.
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The breakout is quite significant as it occurs after over three years of price consolidation within a defined range. Such a long accumulation phase often sets the stage for massive price moves once it is breached. A successful retest usually confirms the validity of the breakout and could signal a continuation of the uptrend.
#2 Strong weekly doji candle
Another important aspect of what needs to happen is “the printing of a strong weekly doji, signaling significant buying pressure from the bulls.” Such a candle on the weekly chart would be characterized by a small body with a long lower shadow, indicating a victory for the bulls in a tug-of-war between buyers and sellers.
#3 The “Musk Effect”
The mention of Dogecoin by Elon Musk, who may promote DOGE as a means of payment on X after the presidential election, could increase the speculative mood. Musk’s tweets have had an extremely strong influence on the DOGE price in the past, but in recent months it has become very quiet. “Elon Musk will probably promote it after the presidential election this year,” speculates the crypto analyst.
#4 Moving Averages
From a technical perspective, Dogecoin’s current position above the 200-day exponential moving average (EMA) indicates a strong bullish sentiment in the long term. Conversely, its struggle to stay above the 100-day EMA suggests immediate challenges. Therefore, a clear close above the 100-day EMA could be another important sign of a DOGE bull run.
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#5 Relative Strength Index
The Relative Strength Index (RSI), currently below 45, supports the theory that there is “plenty of room to grow” without the asset drifting into overbought territory. This is crucial because it suggests that despite recent gains, the asset is not yet at risk of a major sell-off due to overvaluation, according to this metric.
#6 Market trends
The analysis also highlights the current trend of memecoins fundamentally outperforming more solid projects, suggesting a market preference that could favor DOGE in a bull cycle. This must continue. “MEME coins have outperformed solid projects this season, and I believe DOGE will take the lead in this bull run,” the analyst explains.
#7 Weekly close above $0.11
Overall, the analyst claims, “Several indicators suggest that an upside move is imminent.” He plans to maintain a position in Dogecoin with the intention of buying on dips – a strategy that takes advantage of potential volatility to accumulate at lower prices.
The identified trigger point for a bullish acceleration is a weekly close above $0.11 in the grey liquidity zone. A close above this threshold could trigger the expected rally.
At press time, DOGE was trading at $0.10432.
Featured image created with DALL.E, chart from TradingView.com
