Dogecoin’s ongoing price movement is reminiscent of the fractals seen in 2020, where the price skyrocketed by over 15,800% in just six months, reaching a record high of $0.76.
Comparing the price trends of Dogecoin in 2024 and 2021, we can observe similarities between the current performance and the period after the 2018-2020 bear market. During that time, Dogecoin remained within a range of $0.0012 to $0.0056 for an extended period. This phase occurred at the base levels of the chart, indicating a period of relative market equilibrium with low volatility.
In a similar manner, Dogecoin has once again entered a consolidation phase, but this time at a higher price range between $0.055 and $0.181. Interestingly, these new boundaries align with the 0.236 and 0.0 Fibonacci retracement levels, respectively.
The current attempt to surpass the 0.236 Fibonacci threshold is comparable to the breakout observed in the previous cycle, suggesting a potential shift in market sentiment if the price can sustain above this level.
Fundamentals, such as quantitative easing, played a significant role in driving Dogecoin’s price up in 2020. Similarly, in 2024, the memecoin market is experiencing similar catalysts as it seeks to break above its 0.236 Fib line resistance.
In 2020, Dogecoin’s price surged past its 0.236 Fibonacci level, partly due to increased cash liquidity resulting from the U.S. Federal Reserve’s interest rate cuts. Similarly, Dogecoin’s current efforts to breach the 0.236 Fibonacci threshold coincide with the anticipation of three potential interest rate cuts in 2024.
The 2024 price trends of Dogecoin also draw similarities from the 2020 fractal due to the occurrence of Bitcoin halving events. These events, which halve the reward for mining new blocks, had a significant impact on Dogecoin’s price in the past. Following Bitcoin’s third halving in 2020, Dogecoin’s price surged by an astonishing 34,300%.
Likewise, after Bitcoin’s second halving, Dogecoin experienced a rally of over 6,350%, demonstrating its potential for delivering high returns to investors seeking opportunities in alternative cryptocurrencies after halvings.
Elon Musk’s active and public support of Dogecoin during 2020 and 2021 played a crucial role in its dramatic price increases and elevated its ranking among the top cryptocurrencies. Now, in 2024, Musk is considering integrating DOGE into mainstream platforms. For example, Musk has mentioned the possibility of Tesla accepting DOGE payments for purchasing cars in the future.
Furthermore, Musk’s “everything app” X has established an XPayments account for its upcoming payment functionality, leading to expectations that the app will introduce in-app payment capabilities, potentially including cryptocurrencies like Dogecoin, by mid-2024.
From a technical analysis perspective, Dogecoin’s weekly relative strength index (RSI) has crossed above 70, indicating an overbought zone. This raises the potential for a correction or consolidation phase in April. However, if Dogecoin can break above the 0.236 Fib resistance, it could reach the 0.382 Fib line at around $0.26 by the end of April, a 35% increase from current price levels.
On the other hand, if there is a decisive pullback from the 0.236 Fib line, Dogecoin’s price may drop towards its 50-week exponential moving average (50-week EMA) at around $0.095, a 48% decrease from current prices.
It is important to note that this article does not provide investment advice or recommendations. Every investment and trading decision carries risk, and readers should conduct their own research before making any decisions.