Dogecoin (DOGE) is in the midst of an ongoing price correction, which is a consistent precursor to major bull runs, using historical patterns to predict future price action.
On the chart pattern of the “Descending Triangle”. This is a bearish formation that occurs when price follows a descending trendline that intersects a flat support line. Typically, this pattern indicates a continuation of a downtrend, but in the context of Dogecoin, it preceded a significant bullish breakout.
“Continued Dogecoin price corrections are part of the normal behavior that precedes massive bull runs!” shared cryptocurrency analyst Martinez
He explained the historical significance of this pattern in Dogecoin’s trading history: “In 2017, Dogecoin broke out of the descending triangle. Then, DOGE retraced 40% before entering a 982% bull run!”
Martinez further analyzed recent cycles to reinforce his observations, “In 2021, DOGE broke out of the descending triangle again. Then, DOGE retraced 56% before exploding 12,197%!
” Martinez said these pullbacks are not random, but rather characteristic of Dogecoin’s performance in previous cycles, setting the stage for explosive gains.
The analyst drew an analogy for current market conditions: “Now, in 2024, DOGE has once again broken out of the descending triangle! It is currently experiencing a 47% price correction, very similar to previous cycles
This could spark the next DOGE bull run!” This assertion suggests that the current market downturn could be a buying opportunity ahead of a potential uptick.
Martinez’s analysis highlights the cyclical nature of Dogecoin’s price action, indicating a pattern of sharp declines followed by sharp recoveries. “Over the years, Dogecoin seems to be mirroring previous bull cycles! All you need is a little patience,” he concluded.
Amid this optimistic forecast, Dogecoin’s price is in precarious territory in the short term. Since mid-April, DOGE has experienced significant technical resistance. In particular, DOGE price has been rejected by the 50-day moving average multiple times, indicating strong selling pressure at higher price levels.
This trend was accentuated during the broader market downturn, when Dogecoin’s price fell below the key 100-day moving average. Traders often watch this level for signs of medium-term market direction and it has previously provided support.The breach highlights weak market sentiment and could portend extended losses.
At press time, Dogecoin’s price is hovering around $0.1271, having held slightly above its 200-day moving average yesterday, a key psychological and technical barrier. This moving average is now a pivotal point for Dogecoin; its sustained breakout on the daily chart could significantly alter market structure, potentially triggering a fall towards the $0.1005 support level.
The relative strength index (RSI) is at 31.63, approaching oversold territory, but not conclusively indicating an imminent reversal. This suggests that while the market is close to oversold conditions, selling pressure has not yet completely abated. One last leg down may be needed in order for DOGE to enter the “oversold” territory to mark a local bottom.
