Dogecoin just showed a series of Tom DeMark (TD) sell signals, but an analyst explained that Dogecoin's parabolic trend may still continue.
Dogecoin currently exhibits a pattern similar to previous bull markets.
In a recent post on X, analyst Ali Martinez discussed the TD sequence signals that Dogecoin's weekly price has recently formed. The 'TD sequence' refers to a technical analysis (TA) indicator that indicates potential tops and bottoms for a given asset's price.
This indicator involves two phases: setup and countdown. In the first phase, the number of candles of the same color reaches nine. Once nine candles are completed, the setup is finished, and the asset may experience a reversal.
Naturally, if the candles before the setup are green, the price will start to drop, while if the candles are red, the price will rise.
Once the setup ends, the countdown begins. This phase of the indicator is similar to the setup, except it lasts for thirteen candles. After these thirteen candles appear, the asset may be considered to have reached another potential turning point.
Dogecoin recently completed the first class of the TD sequence phase, as shown in the chart below, which displays the weekly price of Dogecoin shared by analysts.
As shown in the chart, Dogecoin has completed the TD sequence setup with nine green candles, indicating that the indicator has just issued a sell signal for the memecoin.
Considering the historical nature of this indicator, it could lead to a drop in the asset. That said, history also tells us another thing, as Martinez highlighted in the chart.
It seems that in the last two bull markets, DOGE observed a similar TD sequence setup in the initial stage of the rebound. These signals led to a drop in the token, but both bearish momentum did not last long, as each rebound restarted after a temporary setback.
If this trend continues, then the latest TD sell signal may just be a minor obstacle to the cryptocurrency price increase.
The chart also shows that the last two bull markets for Dogecoin coincided perfectly with an ascending parallel channel. So far, this channel has also continued to hold in the current cycle, meaning if Dogecoin rises to its upper channel, it could break through the $14 mark.
However, whether the asset will repeat this pattern, or whether this cycle will differ from the previous two cycles, remains to be seen.
DOGE Price
In the past few weeks, the price of Dogecoin has continued to hover around $0.41.
