Are we repeating Dogecoin’s 23,000% growth pattern in 2021?

The price of Dogecoin has almost doubled since reaching the bottom of $0.0491 in June 2022 (June 1401). Due to Elon Musk’s renewed efforts to increase the price of this popular meme coin, if history repeats itself, we will probably see a significant increase in its value this year.

According to Cointelegraph, Dogecoin reached a price of $0.0942 on April 20 (April 31), which represents a 94% growth from its lowest level last year. However, despite the recent impressive growth, the price of Dogecoin is still 88% below its all-time high in May 2021 (May 1400), i.e. $0.76. As a result, the DOJ/USD pair is far from forming a bullish retracement pattern on longer timeframes.

Is a bullish retracement pattern forming?

The price of the 2021 Dodge (1400) increased by more than 23,000%, mainly due to Elon Musk’s verbal endorsements. Interestingly, this trend stopped after Musk called Dogecoin counterproductive during his appearance on Saturday Night Live in May 2021 (May 2021).

After that, the price of Dodge entered a long-term downward cycle, which was exacerbated by the contractionary policies of the Federal Reserve. Also, several major crashes and bankruptcies including Luna, Three Arrows Capital, and FTX Exchange added to the selling pressure of Dogecoin.

Dogecoin witnessed a 100% return of its price in October 2022 (October 1401), contrary to the downward trend of several months. This growth was accompanied by Musk’s controversial purchase of Twitter to raise investors’ hopes that Dodge would be chosen as the official payment token on the popular social network.

Since then, Musk has yet to add Dogecoin payments to Twitter. However, for a few days in early April, he replaced Twitter’s famous blue bird logo with Dogecoin’s official symbol, a meme of a Shiba Inu. Following the publication of the news of this action, the price of Dodge increased by about 40%.

From a fundamental perspective, speculation could help sustain the price growth of Dogecoin since the beginning of the year. However, Dodge needs a 700% growth to reach its all-time high, which will probably only happen if we see wider adoption of Dodge, such as being used as a payment option on Twitter.

Dogecoin technical review

From a technical analysis point of view, the prospect of a bullish return for Dogecoin depends on the price maintaining above the two weekly exponential moving averages.

Especially since the price trend of Dogecoin tried to close above its 50-week (red) EMA around $0.0917 and its 200-week (blue) EMA around $0.0895. This attempt is similar to the trend of suffering and then trying to break out between April and November 2020 (April to November 2019), which occurred before the 30,000% price increase.

We may not see 3,000% DOGE price growth in 2023 due to fundamental issues, but with the Federal Reserve changing its approach to interest rates or the addition of DOGE payments to Twitter, this meme coin could possibly reach 0.76 again in 2023. dollar to rise.

On the other hand, decreasing the price trend below the mentioned moving averages brings the risk of forming the classic ascending triangle pattern.

This pattern will form when the price fluctuates between an ascending support line and a horizontal resistance line. The ascending triangle pattern usually ends when we see a price breakout in line with its previous trend.

As a result of the previous downtrend, the formation of an ascending triangle pattern in the Dodge price trend seems to favor sellers. The target after the breakout in the ascending triangle will be equal to the length of the side of the triangle.

This event can bring the price target of Dodge at the end of the year to the range of 0.0363 to 0.0469 dollars, equal to 45 to 60% reduction compared to the current price level.