Chart analysis indicates a potential quick recovery to the highs of late 2024, with even greater upside potential in 2025.
Dogecoin (DOGE) price has rebounded to $0.33 after falling to a low of $0.26 last week and has formed a triangle pattern, which could soon act as a catalyst for a bullish breakout.
This suggests that in the coming days, Dogecoin's price may temporarily rise back to recent highs of $0.48.
Of course, the 21 and 50 DMA in the $0.37-38 range may provide strong resistance, as they also align with some recent lows.
But this positive atmosphere is likely to last until the end of the year. Why?
Most cryptocurrencies are temporarily recovering from last week's sell-off triggered by the Fed, as the Fed's interest rate forecasts were more hawkish than expected.
But most major cryptocurrencies are still well below levels prior to the Fed's hawkish meetings, indicating there is still room for further recovery.
There are currently many favorable factors supporting the cryptocurrency market. This is because we are entering a new golden age for the cryptocurrency market in the US and globally.
The incoming Trump administration may significantly accelerate the adoption of Bitcoin and other major cryptocurrencies, especially with its goal of establishing a Bitcoin strategic reserve. Moreover, Musk's new government efficiency department (DOGE) is set to be established under Trump's leadership, which will undoubtedly lead the future meme season.
DOGE whales are back with a buying frenzy!
Whales have purchased 270 million DOGE in the past three days, indicating increased activity and a potential rebound from the recent price drop. The surge in whale trading volume is associated with significant price fluctuations in Dogecoin, suggesting they have substantial influence on the market.
Historical data often shows that such whale purchases typically precede market upswings, indicating that DOGE may have bullish prospects.
This reflects that these large-scale purchases align with the upward trend, and if this trend continues, it will increase the likelihood of sustained price increases.
Whale-driven market dynamics, especially in bulk trades, can catalyze further buying pressure, potentially leading to a broader market rebound for DOGE.
The triple force pattern of DOGE price
Analyzing Dogecoin's daily chart shows its key trading patterns align with the three forces (PO3) strategy. Simply put, it involves several phases of accumulation, manipulation, and distribution over several weeks.
The accumulation phase began in early November, marking a relatively stable and consolidating period during which price movements were minimal, indicating that investors are quietly buying DOGE without significantly driving up prices.
In mid-December, the market clearly shifted to a manipulation phase. The sudden price changes during this phase are designed to shake out weak investors, potentially testing new investors' resolve by artificially driving prices down.
The final phase, the distribution phase, is expected to follow. Historically, if this phase mimics past patterns, it could lead to a price increase, potentially approaching or even exceeding previous highs, with speculative targets reaching as high as $1.
With Dogecoin's recent activity, speculation arises that it will enter a bullish trend, and attention on social media and broader market movements could further drive this trend.
How much will Dogecoin's price rise this cycle?
Therefore, with Trump's return to the White House, Dogecoin's market is likely to rebound to recent highs in early 2025. Bulls hope to eventually bounce back to above the historical high of $0.70 in 2021, with the potential to soar to $1 for the first time.
However, could this be the end of Dogecoin? Analysis of Dogecoin's past cycles suggests that bulls need to aim for larger and higher targets, and this rebound could exceed many people's expectations.
Since its inception in 2014, Dogecoin has experienced three market cycles, which can provide clues for Dogecoin's development in 2025.
When drawing Fibonacci extensions from previous bear market lows to previous bear market highs, it can be seen that Dogecoin's rebounds consistently exceed the 4.236 Fibonacci level, surpassing this extension by over ten times during its rebound in 2021.
The Fibonacci extension level of 4.236 from the bear market low of 2022 to the high of 2021 suggests that Dogecoin should reach at least $3 per token in this cycle.
However, historical experience shows that Dogecoin's price often exceeds this level. Given this, it is not unreasonable to expect this round of Dogecoin prices to reach $1. Of course, this implies a market cap in the trillions of dollars, which may be a bit excessive.
