Dogecoin Bull Run on the Horizon? DOGE’s RSI Signal Echoes Past Trends
Dogecoin's RSI Might Have Started a Bullish Cycle | Credit: Getty Images
Key Takeaways
- Dogecoin’s weekly RSI gave a signal that preceded the two previous bull runs.
- The DOGE price is attempting to move above $0.20 and reach a new yearly high.
- Will this Dogecoin bullish cycle be more similar to that starting in 2017 or 2020?
Dogecoin‘s weekly Relative Strength Index recently made a signal that occurred in the beginning of the two previous bullish cycles. Will history repeat for the third time, starting a bullish cycle for Dogecoin in 2024?
How Is This RSI Signal Created?
For what it’s worth, the RSI is a momentum indicator used to determine whether the trend is bullish or bearish. It is also used to find potential buy and sell signals.
The weekly DOGE price action since 2015 shows an interesting relation between the RSI, price action and the start of bullish market cycles. More specifically, RSI movements into overbought territory following DOGE breaking out from a long-term descending resistance trend line marked the beginning of the previous bullish cycles.
The Dogecoin RSI Signal in the Last Two Bull Runs
In 2017 (yellow), this signal led to a 6,460% increase. The increase was even more pronounced at 15,770% in 2020 (green). In the end of February 2024 (red), the weekly Dogecoin RSI moved into overbought territory and the price broke out from a descending resistance trend line, giving the same signal for the third time.
Another interesting observation is that the DOGE price always reached at least the 4.618 external Fibonacci retracement of the previous all-time high. Doing so in the current cycle will lead to a 3,300% increase and a new all-time high price of $3.10.
However, it is important to note that the increasing DOGE supply will make it more difficult for the price to reach such highs. At a price of $3.10, DOGE’s market cap will be at $445 billion, the same as that of Ethereum.
At the first all-time high in January 2018, the total DOGE supply was 112 billion. At the current all-time high of May 2021, the supply was 130 billion. Now, it is 143 billion. In total, this is an increase of 28% from January 2018.
In addition to the general diminishing returns in subsequent bullish cycles in crypto, this increase in supply makes it more difficult for the memecoin to increase at the same rate.
DOGE Price Prediction: New Yearly High Incoming?
The daily time frame chart supports the bullish outlook even in the short-term. It indicates that DOGE is in the fifth and final wave of an upward movement that started in August 2023.
The first potential target for the top of this upward movement is near $0.33, an increase of 75% from the current price. The second one is between $0.45 and $0.50, an increase of 150% from the current price. Afterward, a correction could take place.
The daily RSI supports this bullish count and aligns with the weekly one. The RSI broke out from its bearish divergence trend line (green) and moved above 50. This is a sign that the drop is complete, and another upward movement has started.
DOGE’s Bullish Cycle is Just Beginning
DOGE’s weekly and daily time frame readings both align with each other, suggesting more gains are ahead. While this cycle’s increases might not reach the heights of the previous one, Dogecoi is still in a favorable situation regarding the price action for the rest of 2024.
Dogecoin Price Plummets 40%: History Repeats, But What Lies Ahead for DOGE?
Dogecoin Price Prediction 2024: What’s Next for DOGE in Memecoin Rally?
