Dogecoin Could Be Preparing For Next Big Rally, Analyst Explains
An analyst has explained how Dogecoin could currently be gearing up for the next bull run if historical pattern is anything to go by.
Dogecoin Has Recently Shown Similar Trend To Past Cycles
In a new post on X, analyst Ali Martinez has discussed about how Dogecoin has been forming a familiar pattern in its monthly price recently. Below is the chart shared by the analyst, which depicts the pattern in question.
As is visible in the graph, Dogecoin had been stuck inside a long Descending Triangle between 2021 and 2024. The Descending Triangle here refers to a technical analysis (TA) pattern that, as its name suggests, looks like a triangle slopped downwards.
In this pattern, the price of the asset consolidates between two lines: a bottom level parallel to the time-axis and an upper level converging towards the bottom level.
Like other TA patterns, the upper level is probable to act as resistance, while the bottom one as support. Also, a break out of either of these lines can imply a continuation of trend in that direction.
From the chart, its visible that Dogecoin managed to find a break above its multi-year Descending Triangle this year and as the pattern foreshadowed, the surge above the upper level led to a sharp rally, in which the memecoins price saw an appreciation of almost 208%.
Since the top of the run, though, the asset has witnessed a peak retracement of around 65% so far. This development, however, may not actually be bad, as the analyst has pointed out that the chain of events that Dogecoin has gone through in recent years is in fact similar to what happened on two other occasions in the past.
In both of these instances, DOGE broke out of a multi-year Descending Triangle to observe a sharp rally, followed by a retracement of a similar scale as the one witnessed recently. The memecoin then went on to observe full-blown bull runs in both of these cases.
Based on this historical pattern, Martinez notes, after a recent 65% pullback, DOGE could be gearing up for the next big rally! It now remains to be seen how the assets price develops from here and whether any similar rally would follow this time as well or not.
In some other news, whales have shown rising activity on the Dogecoin network recently, as the analyst has pointed out in another X post.
This increased activity from the large holders can lead to more volatility for Dogecoin, which could be towards a net upside if the whales are making these transfers for buying purposes.
DOGE Price
At the time of writing, Dogecoin is trading around $0.11, down more than 7% over the last week.
Read more: https://www.newsbtc.com/news/dogecoin/dogecoin-preparing-next-big-rally-analyst-explains/
Text source: NewsBTC
