- The price of Dogecoin has risen by more than 20% in the past seven days
- Some market indicators pointed to a short-term correction
Dogecoin [DOGE] defied all expectations last week with his impressive performance in the charts. That’s not all, as some signs seemed to indicate that this could be the start of another massive bull rally.
In fact, the latest analysis shows that there is a bull pattern in place, one that could push the price of DOGE much higher.
Dogecoin is waiting for a major breakout
Dogecoin bulls clearly dominated the market last week as the memecoin’s price rose by more than 20% over the past seven days. In the last 24 hours alone, the price of DOGE has increased by 4%. At the time of writing, the world’s largest memecoin was trading at $0.1622.
AMBCrypto’s look at IntoTheBlock’s data revealed that after the aforementioned increase, 5.34 million DOGE addresses made a profit. This number accounted for 84% of the total number of Dogecoin addresses.
Source: IntoTheBlock
In the midst of all this, Ali, a popular crypto analyst, shared a tweet highlighting a bull pattern on the Dogecoin chart. According to the same, the price of DOGE has increased sharply a few days ago. After this, DOGE’s price showed a slight correction.
However, this helped form a bullish flag pattern. At the time of writing, DOGE was on the right track as it appeared to be approaching the upper limit of the pattern. A breakout above this flag pattern could push DOGE towards $0.209 in the coming weeks.
Source:
Interestingly enough, Elon Musk also played a big role in DOGE’s latest pump, something that has happened several times in the past.
AMBCrypto had previously reported how Musk’s X-post included a Dogecoin image. This could have fueled bullish sentiments, causing the memecoin’s price to rise sharply.
Will this upward trend sustain itself?
Since DOGE’s recent performance has been bullish, AMBCrypto checked the memecoin’s on-chain data to find out how likely Dogecoin was to continue its rally. According to Santiment, DOGE’s MVRV ratio declined after peaking on October 29.
Similarly, DOGE’s velocity also dropped, meaning Dogecoin was used less frequently in transactions within a given time frame. Both metrics suggested that DOGE may see a correction as it consolidates within a bullish flag pattern.
Source: Santiment
Finally, we reviewed the daily chart of the memecoin to better understand if a price correction is coming or if it will continue to rise.
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We found that Dogecoin’s Money Flow Index (MFI) recorded a sharp decline, indicating a price drop. In the event of a correction, DOGE could fall back to its support near the 20-day SMA, from where the bulls have an opportunity to regain control.
Source: TradingView