Dogecoin has entered the area that previously triggered a memecoin bull market.
Dogecoin's trading price is close to the historical low of the ascending channel
Over the past decade, Dogecoin (DOGE) has roughly followed an ascending channel in its weekly price, and this technical analysis (TA) pattern has become an important basis for judging its future price trends. The so-called 'ascending channel' refers to the shape formed when an asset's price fluctuates between two parallel upward trend lines. In this way, investors can clearly see the highs and lows of the price and make predictions based on these points.
Structure and Significance of the Ascending Channel
In this ascending channel, the asset's price fluctuates along two parallel trend lines. The upper line of the ascending channel represents the continuously created highs and is seen as a resistance level; while the lower line connects the continuously rising lows and is viewed as a support level. In other words, once the price touches the upper line, it is likely to encounter resistance, while touching the lower line may provide support and lead to a rebound.
Nevertheless, Dogecoin has repeatedly fallen below its long-term ascending channel's lower line over the past few years, with the most recent occurrence at the beginning of this year. However, after each time it fell below the lower line of the ascending channel, Dogecoin's price gained strong buying power as it approached this support area and quickly rebounded.
'Historically Strong Buying Area'
Many technical analysts believe that the price area after breaking below the lower limit can be regarded as a 'historically strong buying area.' This judgment is not unfounded, as historical data shows that Dogecoin tends to start a strong upward trend every time it rebounds from this area. From the charts, whenever the price retests this area and regains support, multiple bull markets for Dogecoin often follow.
Currently, Dogecoin's price is in this area. Although Dogecoin has recently attempted to re-enter the ascending channel, those attempts have been unsuccessful, and the price continues to hover near the support area. In light of this situation, market participants are generally focused on whether Dogecoin will break through this channel, potentially triggering a new round of rebound.
Current Market Dynamics of Dogecoin and Future Prospects
According to the latest data, Dogecoin's trading price is about $0.21, having risen nearly 4% in the past 24 hours. Nevertheless, the current price is still near the lower line of its ascending channel, which means it is still within the 'historically strong buying area.'
Market Outlook: Can It Break Through the Ascending Channel?
The current key issue is whether Dogecoin can break through this ascending channel and overcome its recent resistance level. If Dogecoin can break through the channel, it may return to an upward trajectory, ushering in a new rebound cycle. However, if this trend cannot be sustained, it may indicate that Dogecoin is entering a new consolidation phase, or even breaking its past upward pattern.
It is worth noting that although Dogecoin's price remains under downward pressure, each time it breaks below the support line, it triggers strong market demand, driving the price to rebound. Therefore, in the short term, Dogecoin may still face a fluctuating consolidation pattern, but in the long term, it still has strong upward potential.
Conclusion
For investors, this is a key moment to observe Dogecoin's future trends. If Dogecoin can break through the current resistance and re-enter the ascending channel, a new upward trend may be silently brewing. Within this 'historically strong buying area,' risks and opportunities coexist, and investors should pay attention to further market developments, ready to seize potential rebound opportunities.
