Recently, the price trend of Dogecoin is releasing signals that cannot be ignored. Last week, this meme coin marked by the Shiba Inu avatar once broke through the $0.2 mark. Although there is still a significant gap from the historical peak of $0.7, it has made the market smell a long-lost restlessness - which means that at the current price, it still retains a considerable upside. The view of cryptocurrency analyst CryptoKaleo is particularly noteworthy. He pointed out that Dogecoin's current price trend shows characteristics that have not been seen since December 2020. Multiple technical indicators jointly point to a strong bullish signal, which makes many investors think of the crazy market in the market three years ago.
Looking back at 2020, Dogecoin had a legendary narrative. At that time, this cryptocurrency, born as a joke, lingered at a low level for a long time. Until December of that year, driven by Musk's frequent voices on social platforms, its price soared like a lit fuse, completing a 36000% increase in just a few months, and once became the focus of the global financial market. Now, the market structure seems to be replicating a similar trajectory: After a deep correction, Dogecoin's price has stabilized from a low level. The current point is highly close to the level before the start of 2020, and the trading volume is gradually increasing. The trend line pattern on the technical chart almost overlaps with the eve of the surge. This "historical mirror" makes optimists believe that a new round of outbreak may be brewing.
From a technical point of view, Dogecoin's weekly chart shows that it recently broke through the half-year-long triangular consolidation range. Although the RSI indicator has entered the overbought area, there is no divergence. The MACD red column continues to enlarge. These signals are consistent with the characteristics of the start-up phase in 2020. Some analysts speculate that if the upward momentum continues, its price is expected to hit $0.5 in the short term, and may even test the $1 integer mark in the medium and long term. In extreme cases, it may touch a high of $2.4 - this target price has an imagination space of more than 10 times compared to the current price.
However, calmly examining the market reality, the 36000% surge in 2020 may be difficult to repeat. From a fundamental point of view, Dogecoin's issuance mechanism is the core constraint: Unlike Bitcoin's fixed total amount, it adopts an unlimited inflation model, with an annual new supply of 5 billion, which means that the higher the price, the larger the amount of funds required to maintain the increase. Calculated at the current price, if the same increase is repeated, its unit price will soar to $72, corresponding to a market value of more than $2 trillion, which is close to twice the current total market value of global gold ETFs, which is obviously beyond the market's carrying capacity. In addition, the regulatory environment is also very different from the past. Many countries have gradually tightened restrictions on the trading of cryptocurrencies, which has greatly reduced the probability of "extreme market conditions".
Most institutional views believe that $1 is more likely to be the actual ceiling of this round of increase. For investors, Dogecoin's charm lies in its "emotion-driven" characteristics - its price fluctuations are often deeply tied to social media popularity and celebrity remarks, rather than the valuation logic of traditional financial assets. This characteristic may bring short-term windfall, but also hides the risk of sharp correction. In the market game in July, it is not yet known whether it can replicate the miracle of 2020, but what is certain is that every abnormal movement of this meme coin is testing investors' wisdom in weighing risks and opportunities.
