Dogecoin (DOGE) Defends Key Support as Macro Breakout Targets $1 to $4
Dogecoin (DOGE) is currently experiencing weakness in the short term, but its overall market structure continues to fascinate market analysts. Despite the current downturn, market patterns indicate that the asset is currently trading in a very significant accumulation range. This market is expected to lay the basis for a strong upward move.
At the time of writing, Dogecoin is trading at $0.1250, recording a 24-hour trading volume of $1.86 billion and a market capitalization of $21.15 billion. The DOGE decreased by 14% over the last 24 hours, reflecting short-term pressure across the market.
Dogecoin Wave 5 Setup Forms
Despite the recent correction, well-known crypto analyst Crypto Patel shared an optimistic long-term outlook on DOGE, which he attributes to a macro setup that could cause a massive Wave 5 expansion of over 3,000%, as long as the demand on the higher time frames is maintained.
According to Patel, Dogecoin is now trading within a major accumulation range in a higher timeframe, forming a price action that closely resembles the same pattern formed before its major breakout in the 2020-2021 cycle. In the previous cycle, DOGE went on to surge by over 26,800% after being in an accumulation range for an extended period.
Technically, Patel says that DOGE has already finished Wave 1 and Wave 2, and Wave 3 reached a peak of about $0.484. Currently, the market is in Wave 4, a correction in a descending channel. A region of high demand is identified from $0.115 to $0.09, and it is a crucial point of accumulation. As long as it stays above $0.06 on a larger timeframe, the bullish setup is still in effect.
If this plays out as expected, Patel sets forth aggressive targets for Wave 5: $0.28, $1, $2, and potentially all the way to $4. He observes that these levels represent a good risk vs. reward tradeoff if the historical behavior continues. This forecast will be rendered false by a weekly close below $0.06.
Also Read | Dogecoin Whales Accumulate 171M DOGE, Fueling Hopes for $0.70 and Beyond
Dogecoin Consolidates After Liquidity Break
Meanwhile, another analyst, BitGuru, noticed that Dogecoin is already breaking out of surrounding liquidity and is consolidating into a tight range around support. Such price action is not uncommon before a strong movement, especially when investors start showing interest once again.
Although there is some uncertainty about the immediate price movement, both analysts are saying that the current state of Dogecoin could be setting things up for a strong move when market conditions improve.
Also Read | Dogecoin Signals Trend Reversal, Eyes $0.16 Breakout
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