Popular meme coin Dogecoin (DOGE) experienced a significant price decline in April, ending the month with a 40% decline. Heading into May, prices for the popular dog-themed cryptocurrency have remained unstable, with a 3.39% decline recorded so far. This situation attracted the attention of traders and analysts in the cryptocurrency market, as there was uncertainty about the future price movements of Dogecoin.
Crypto analyst Ali Martinez according toThis decline in Dogecoin’s price reflects a typical behavior often seen before major bull runs. He is also of the view that the current decline could be a healthy pullback, setting the stage for a potential bull run amidst a breakout from the descending triangle formation.
The pattern the analyst uses to analyze Dogecoin’s price movements is the descending triangle pattern. This pattern is characterized by overlapping loser highs (bottoms lower than the leading low) with horizontal support lines becoming evident at the lower levels. It usually signals a breakout in price after a period of consolidation.
Looking at Dogecoin’s history, the breakouts from this descending triangle pattern are notable. We can understand this situation more clearly with the examples of analyst Ali Martinez. For example, in 2017, meme coin broke out of the descending triangle formation and its price increased by 982% after this breakout. However, before this rise, there was a 40% decline.
Similarly, in 2021, Dogecoin broke out of a descending triangle formation and moved its price upwards. After this breakout, there was a 56% pullback, followed by a massive 12,197% rise.
By 2024, Dogecoin has once again broken out of the descending triangle formation and is currently experiencing a 47% price correction, as in past cycles. This indicates that it may follow a course similar to the trends observed in the past.
If DOGE breaks the descending triangle formation and undergoes a significant correction, the stage can be set for a potential bull run that will take it to new highs. However, it is always important to remember that past performance is no guarantee of future results and every investment decision requires careful analysis. It remains to be seen whether Dogecoin will break new heights. At the time of writing, Dogecoin is trading at $0.13.
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