As Dogecoin (DOGE) struggles with short-term bearish sentiments, historical price movements and technical indicators suggest the top meme coin might be poised for another parabolic rally.
This outlook comes from renowned cryptocurrency trading expert Ali Martinez, who drew parallels between Dogecoin’s 2017 and 2021 movements, hinting at explosive growth after significant retracements, as shared in an X post on December 23.
Back in 2017, Dogecoin surged 212%, followed by a 40% retracement, before embarking on a 5,000% rally. Similarly, in 2021, DOGE climbed 476%, retraced by 56%, and soared by 12,000% to reach its all-time high.
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The same pattern appears to be replicating in 2024, with the meme coin surging 440% before undergoing a 46% retracement, closely mirroring its previous cycles.
According to Martinez’s analysis, this setup could signal the beginning of another parabolic move for Dogecoin.
“Now, in 2024, DOGE is up 440% and has retraced by 46%. If history repeats, another parabolic rally is on the way,” Martinez said.
Indeed, Dogecoin’s price has been confined within an ascending channel, a pattern often preceding major rallies. A breakout above the channel could signal a bullish reversal and trigger a parabolic rally.
DOGE’s $0.70 price target
In another X post on December 21, cryptocurrency trading analyst Javon Marks also highlighted that historical patterns could hint at another DOGE rally.
The analyst noted the recent pullback mirrors price movements from 2020, when DOGE broke through descending resistance patterns, consolidated briefly, and surged over 122%, achieving more than double gains.
The anticipated target for this rally is $0.73905, suggesting Dogecoin could revisit and surpass its all-time high.
Besides the technical setup, Dogecoin’s potential to rally is also guided by fundamental factors, with Tesla (NASDAQ: TSLA) CEO Elon Musk’s influence remaining a key element. Musk’s commentary on Dogecoin has been influential, and the possibility of a rally could coincide with his official appointment as the head of the Department of Government Efficiency (DOGE) in January 2025.
Additionally, DOGE has recently seen an increase in whale accumulation, reinforcing confidence in the asset. Historically, such transactions have preceded major price rallies.
DOGE price analysis
At press time, DOGE was valued at $0.31, showing weakness on the daily and weekly timeframes, dropping 0.40% and 21%, respectively.
Amid the current correction, Dogecoin’s technical setup suggests a possible downside in the short term. The coin is trading below its 50-day simple moving average (SMA) of $0.360157, reinforcing bearish momentum.
DOGE remains above its 200-day SMA, which is at $0.178915, indicating that the long-term trend may still hold bullish undertones.
Interestingly, the Fear & Greed Index reflects a reading of 73, firmly in the “Greed” zone, hinting at strong market interest despite prevailing negative sentiment.
In summary, as DOGE faces short-term weakness, historical patterns suggest Dogecoin could be on the verge of another explosive rally, eyeing a breakout toward the $1 mark.
Featured image via Shutterstock
