Dogecoin, the popular meme cryptocurrency, has been making waves in the market with its recent price surge. In the past seven days, the price of Dogecoin (DOGE) has increased by almost 40%, outperforming the wider crypto market, which has seen a growth of nearly 8% in the same period.
According to technical analysis, DOGE has broken out of a multimonth symmetrical triangle, a bullish continuation pattern. This breakout is significant, as it indicates a strong upward trend. The trading volume during the breakout has also tripled, signaling strong bullish dynamics.
Doge/USD vs. Total Crypto Market Capment Daily Chart. Source: Tradingview
Doge Price Breakout and Future Prospects
The weekly DOGE price chart shows a clear breakout of the symmetrical triangle, with the price increasing from around $0.296 to its current level. The breakout target is estimated to be around $0.60, which would represent a 95% gain from the current price level.
Some chartists, including CryptoCrew and CryptoGoo, have set their sights on a lower target of $0.45, which corresponds to the upper trend line of a multi-year triangle.
Doge/USD Weekly Price Chart. Source: Tradingview
Doge/USD Weekly Price Chart. Source: Tradingview
On-Chain Metrics and Price Movement
The relative strength index (RSI) for DOGE has also reinforced the bullish setup, as it has bounced back from its oversold threshold of 70.
However, for the bullish trend to continue, the 50-week exponential moving average (50-week EMA) near $0.227 must hold as support. A decisive close below this level could lead to a decline towards the 200-week EMA at around $0.215.
The MVRV Z-Score, which measures whether DOGE is overpriced or undervalued compared to its realized price, is currently near 1.35. This level has often preceded significant rallies in the past, including the 230% gain in November.
Doge MVRV Z-Score vs. Price diagram. Source: Glasnode
Conclusion and Future Outlook
Despite the recent delay in the US Dogecoin ETF launch, the price of DOGE continues to increase, driven by a combination of technical and on-chain factors. With the breakout target set at $0.60 and the MVRV Z-Score indicating undervaluation, there is plenty of room for growth in the coming weeks.
As with any investment, it’s essential to do your own research and consider the risks involved. This article is for informational purposes only and should not be taken as investment advice.
For more information and analysis, visit Cointelegraph.
