Dogecoin price is currently trading in a bearish pattern as it continues to undergo corrections following a remarkable rise in prices over the past two months. Nevertheless, technical analysis suggests that the leading coin is still trade in a bullish configuration over longer periods.
In a technical analysis of Dogecoin’s price action on the 2-week candlestick chart, crypto analyst Javon Marks noted an impending 570% rally for DOGE, which depends on a breakout above the d Fibonacci extension of 1.0.
Fibonacci extension indicates bullish momentum
According to a Dogecoin Technical Analysis Posted on social media platform X by Javon Marks, Dogecoin price is currently in the midst of its third major bull cycle since its inception. Drawing parallels to Dogecoin’s historic price action during its two previous bull cycles, Marks suggests that the cryptocurrency is well-positioned to see a 570% increase from its current price.
Using the Fibonacci Extension Indicatorhe identified the 1.618 level as the first significant bullish target of this cycle. Indeed, the last two cycles have been marked by a breakout above this Fibonacci level when projected from the low of the previous bearish phase. As such, Dogecoin has surpassed this level during each of its previous bull runs.
According to the chart below, the bearish phases were highlighted by Dogecoin rebounding off a relatively constant support level. This price action is then followed by strong bullish candles that exceed the previous cycle’s all-time high.
The current (third) Dogecoin cycle is currently unfolding in a similar way. However, the meme coin appears to have faced a notable resistance level before regaining the previous cycle’s all-time high of $0.7316. In particular, Dogecoin price encountered multiple rejections around $0.475 in early December, which resulted in a correction trajectory since then.
At the time of writing, Dogecoin is trading at $0.316, representing a 50% price drop since December 8. Additionally, data from Coinmarketcap shows that the leading coin is currently down 12.5% over the past seven days. Nonetheless, crypto analyst Javon Marks suggests that history has not changed and still indicates a fairly high probability that prices will reach Fib extension levels towards new all-time highs.
Analysis places Dogecoin price beyond $2.8
Cyclical Price Movements of Dogecoin have had a defining feature of its market behavior, which is a successive breakout above the 1.0 and 1.618 Fib extension levels from the market’s bearish low. Currently, bearish momentum depends on a breakout above an initial breakout above the 1.0 Fib Extension level, which sits around $0.569. Exceeding this level would result in open the stage for Dogecoin bulls to challenge its current all-time high.
If the current cycle follows the trends of previous cycles, Dogecoin could surpass the 1.618 Fibonacci extension, which would put it at least around $2.28. From here, Dogecoin price could continue with bullish momentum and achieve further price milestones.
Featured image created with Dall.E, chart from Tradingview.com