Dogecoin’s $20 Dream: Will DOGE Price History Repeat Itself?

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As a seasoned crypto investor with a knack for spotting trends and interpreting charts, I find myself at a crossroads with Dogecoin‘s current position. The past week has been a rollercoaster ride, but I’ve seen crazier markets in my time.

Over the last seven days, the combined value of all cryptocurrencies has decreased by approximately 11.53%, now standing at around $3.2 trillion. During this substantial market dip, meme coins experienced a decline from their peak worth of $120 billion down to their current value of about $93.26 billion.

Dogecoin (DOGE) experienced a 22% decline, dropping its price to $0.3135. Its current market capitalization stands at approximately $46.18 billion, indicating a 32% decrease in value over the last month.

Despite the pessimistic market trends, the significant support for Dogecoin at around $0.30 continues to hold strong. Could a surge of bullish activity be on the horizon for Dogecoin if Bitcoin manages to maintain its position above $95,000?

Dogecoin Floating Above $0.30 Aims a Rebound Run

As an analyst, I’ve noticed that my analysis of the daily chart for Dogecoin (DOGE) reveals a failed bullish attempt to maintain its rising channel pattern. A bearish engulfing candle on December 9 triggered a significant 11.13% drop in price, leading to a breakdown rally. This rally extended to the psychologically significant level of $0.30, happening concurrently with the broader market correction.

At the moment, Dogecoin’s price is bouncing around between its 50-day and 100-day moving average lines. As it faces rejections from these key levels, it seems to be holding steady over the weekend. The meme coin is currently trading at $0.3141, experiencing a slight increase of 0.5%.

In the midst of consolidation, the RSI line has gently levelled off just above the oversold threshold. This could potentially signal a change in direction if the meme coin starts picking up speed again.

Additionally, the recovery run for Dogecoin is nearly touching a significant support trendline. This strengthens the overall backing for the cryptocurrency, potentially boosting its price upward.

In terms of its price movement, Dogecoin currently faces an immediate resistance around $0.38 and a more significant psychological barrier at $0.40. On the flip side, if it falls below key support points like the local trendline and the 100-day moving average line, there’s potential for a drop to approximately $0.2198. This suggests that in its current state, Dogecoin has a potential downside of nearly 30%.

Analyst Projects Parabolic Rise to $20

Even though there’s been a rise in short-term price fluctuations, the overall trajectory seems to point towards a steep upward trend, much like the parabolic growth observed in Dogecoin back in 2017 and 2021, as suggested by independent technical analyst Ali Martinez in his latest tweet.

As an analyst, I’ve observed that back in the day, Dogecoin experienced a dramatic upward trajectory, soaring by 220%, followed by a 40% dip. Interestingly, it then rallied a staggering 5000%. Fast forward to 2021, this pattern repeated itself as the price of Dogecoin spiked an impressive 476%, dipped 56%, and subsequently skyrocketed by an astonishing 12,000%. With the possibility of history repeating itself, we’ve seen Dogecoin surge by 240% in 2024. However, it has since experienced a retracement of 46%.

Looking at its historical trend, there’s a possibility that Dogecoin could reach a price of around $20 in the future. Although this figure may appear hopeful, the upward trajectory within a channel makes it an interesting prospect for bullish investors.

Dogecoin OI Drop and High Liquidations Warns a Crash

Due to the rise in price instability over the past week, the open interest for Dogecoin has decreased to approximately $1.95 billion, falling below the $2 trillion threshold. This indicates a diminished enthusiasm or interest towards Dogecoin.

Additionally, the long-to-short ratio indicates a negative trend, decreasing to approximately 0.981. Over the last day, Dogecoin liquidations amounted to about $19.33 million.

As a result of bulls experiencing $11.45 million in long liquidations, there is an increase in bearish outlooks. Additionally, the bearish trend is strengthening as the funding rate for Dogecoin, based on open interest, has decreased from 0.0497% to 0.0053%.

Conclusion

The sudden decrease in funding rates following the OI crash indicates a significant shift in derivative attitudes, as sellers are now dominating the market. Consequently, the short-term derivatives market shows a highly pessimistic outlook, as sellers expect the current trend to persist.

Nevertheless, the technical indicators and past trends suggest a potential recovery, given that meme coins often display significant price swings. If this correction persists above the support line, it might be deemed as a healthy one.

In short, optimistic buyers could find the dip as a potential entry opportunity.

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2024-12-23 13:26