Once again, Dogecoin [DOGE] has sparked significant interest in the market, as technical indicators and price movements hint at a potential breakthrough compared to Bitcoin [BTC].
An analysis of the charts uncovered a bullish pattern that may drive DOGE up by a notable 2,400%. Recent examination of on-chain data has also revealed positive trends, further supporting the likelihood of an upward trajectory.
Comparing Dogecoin and Bitcoin
Recent data from Dogecoin’s chart indicates a clear breakout from a descending channel that has been forming for multiple years. This breakout, accompanied by strong upward momentum, sets DOGE up for a significant price surge.
The expected outcome from this breakout suggests a target of 0.00009375 Bitcoin, signaling a remarkable 2,400% increase from its current position.
Looking at the MACD (Moving Average Convergence Divergence) indicator on the DOGE/USD daily chart, it aligns with the optimistic sentiment. The MACD line has crossed above the signal line, indicating a rise in upward momentum.
The histogram reflects a minor consolidation phase – a common occurrence during initial breakout stages. Moreover, the 200-day moving average has shown robust support around $0.26, further solidifying the potential for a continued bullish momentum.
The correlation coefficient (CC) between Bitcoin (BTC/USD) and Dogecoin (DOGE/USD) currently stands at -0.80, demonstrating an inverse relationship between the two.
With Bitcoin steadying around $95,000, Dogecoin seems to be ready to benefit from the shift in market liquidity towards alternative coins, a trend often seen during bullish cycles.
Noteworthy Increase in Daily Active Addresses
An analysis of Santiment data showcased a significant surge in Dogecoin’s daily active addresses towards the end of November, peaking at over 1.6 million. This surge marks a notable spike compared to the relatively low activity levels observed earlier in the year.
Historically, spikes in active addresses have preceded substantial price surges, hinting at renewed interest from investors and increased network activity.
Furthermore, there has been an uptick in whale activity, with larger transactions becoming more frequent. This suggests that institutional investors or high-net-worth individuals are positioning themselves for potential price movements. The alignment of on-chain activities with technical breakout signals further bolsters the positive outlook for Dogecoin.
Sentiment in the Dogecoin Market and Price Predictions
The sentiment surrounding Dogecoin in the market remains positive, with social metrics reflecting a rise in discussions and mentions related to DOGE.
This sentiment aligns with the token’s historical tendency to thrive in hype-driven environments, potentially amplifying its upward rally.
Utilizing Fibonacci extensions from the recent low, Dogecoin is expected to face resistance at $0.78 (2.618 Fibonacci level), with a long-term target set at $1.79 at the 4.236 extension.
This forecast coincides with the breakout target seen on the DOGE/BTC chart, further strengthening the potential for significant gains. However, traders should exercise caution regarding profit-taking at key psychological levels, such as $1.
With positive technical indicators in place, Dogecoin appears to be on the brink of a substantial breakout. Its inverse correlation with Bitcoin adds an intriguing element amidst BTC’s consolidation, positioning DOGE as a standout performer within the altcoin arena.