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Dogecoin price sustained massive declines since hitting its ATH in May 2021. However, the retracement phase could be a blessing in disguise as it printed a popular bullish pattern that presents the potential of an upcoming bullish rally for Dogecoin.

Dogecoin Price Contemplates Breakouts

Dogecoin saw its price losing a staggering 85% from the $0.740 all-time high recorded in May’s first week. The resulting plummet created a base near $0.109 in February’s final week. The successive months of downside slides continued for almost a year, even with most altcoins rallying.

The weekly crashes formed three unique lower lows and lower highs, revealing a declining wedge setup when connected with trend lines. This technical pattern predicts a 68% surge toward $0.241, determined by adding the initial swing high to low distance to the breakout level.

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Though last week’s sessions saw Dogecoin price breaching the topside trend line, it could not sustain the momentum. Nevertheless, the crypto nearly erased the 23% gains, and Dogecoin trades near $0.130 at this publication.

Presuming Bitcoin forms a bottom and reverses, alternative tokens, including Dogecoin, will mimic the move. Such developments can see the original meme coin on an impressive breakout past the declining wedge’s top trend-line near $0.143.

That might catalyze a 68% run-up for DOGE to $0.241. Meanwhile, that would mean an 88% uptrend from the token’s current position. Thus, patient market players may capitalize on this move.

Though the Dogecoin price outlook appears sluggish, the 365-day MVRV model presents a bullish narrative. This metric shows profits or losses by investors that bought the token within the previous year.

A negative reading shows investors are underwater, while a positive one suggests profits for holders. The latter heightened sell-off probability, thus not a lucrative moment for accumulation.

Santiment’s brackets suggest values between -10% and -15% show near term holders in losses. Meanwhile, long-term investors accumulate amid these conditions. The area, dubbed an opportunity zone, has fewer sell-off risks.

Dogecoin has the 365-day MVRV hovering near -38%, a lucrative accumulation level for long-term traders as near-term holders remain underwater. Therefore, DOGE has a higher probability of forming a base around its current price region, matching the technical standpoint’s outlook for the meme token.

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Franklin Smith

By Franklin Smith

Franklin Smith is a Senior Crypto Journalist and Analyst at Herald Sheets, with over seven years of experience in the cryptocurrency and blockchain industry. Known for his insightful articles and in-depth analysis, he is an influential voice providing valuable insights to investors and enthusiasts. Franklin holds a bachelor's degree in Journalism and Communications from the University of California, Berkeley.