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Dogecoin finally seems to have it beyond its extensive consolidation phase with the return of greed feeling ion the crypto market. Interestingly, the technical analysis of the Dogecoin price chart shows that this greed sentiment is about to push the meme coin into a parabolic rally that would send it to new all-time highs.
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This rally comes from a projection of the ‘Power of 3’ concept, where recent price action pushed Dogecoin into the distribution phase.
The strength of 3 patterns indicates bullish momentum for Dogecoin
The Power of 3 pattern is a technical analysis concept that divides the price cycle into three distinct phases of accumulation, manipulation and distribution. These phases each differ in their price performance. The accumulation phase, the first phase of the pattern, is characterized by a consolidation around a recent high after a strong upward price action.
Next is the manipulation phase, where price action breaks below the accumulation phase support and begins trading within a range just below this support. The distribution phase is the final phase, which is characterized by a strong price breakout in an upward direction as momentum increases and a large number of participants enter the market.
According to technical analysis of Following Dogecoin’s price action by crypto analyst Trader Tardigrade, two consecutive Power of 3 patterns have appeared on the DOGE daily chart. The first pattern is fully completed and played out in the months of March to November 2024, with the subsequent distribution phase pushing Dogecoin to multi-year highs.
The second pattern began shortly after the first ended and is now approaching its final phase. The accumulation phase for this pattern lasted from early November to mid-December, during which Dogecoin declined at $0.48 and started to consolidate around $0.48 to $0.4. This was it followed by the manipulation phasewhich lasted from mid-December through the first weeks of January after Dogecoin fell below $0.4
Recent positive price movements show that Dogecoin has now left the manipulation phase and is now in the distribution phase. If history were to repeat itself, Dogecoin could see another parabolic rally from here, driven by increased market participation and growing bullish sentiment.
Breaking out of consolidation: the 2017 parallel
Trader Tardigrade predicted that the distribution phase will push the Dogecoin price above the current all-time high of $0.7316 and eventually above the $1 mark. The final price target is around $1.3, which represents an upside of 225% from the current price.
Bear animal also drew parallels between Dogecoin’s current move and its 2017 price action. He noted that Dogecoin has broken out of a consolidation trendline in a manner similar to a breakout before the 2017 rally. If history repeats itself, Dogecoin will could reach a local peak above $3 by 2025.
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At the time of writing, Dogecoin is trading at $0.3975.
Featured image from Pexels, chart from TradingView
