In the volatile crypto world, technical signals play a crucial role in forecasting price trends. Recently, renowned analyst Ali Martinez pointed out a noteworthy signal on the long-term chart of Dogecoin (DOGE) – a signal that has paved the way for many strong price increases in the past.
Dogecoin approaches the bottom of a multi-decade ascending channel.
According to a post on platform X, Martinez stated that Dogecoin is trading near the lower level of a long-term ascending channel – a technical pattern that this coin has followed for nearly a decade.
The weekly chart that Martinez shared shows that DOGE has continuously fluctuated within a range defined by two parallel upward trend lines: one acting as resistance above and one as support below. However, it is noteworthy that during some periods, DOGE temporarily broke away from this support line before recovering strongly.
"Every time Dogecoin tests the lower area of the channel, it bounces back strongly – creating significant price increases," Martinez remarked.
The area between the main support line and the lower trend line – referred to as the "historically strong buying zone" – is currently where Dogecoin is fluctuating. History shows that each time DOGE enters this zone, the bullish momentum often appears shortly thereafter.
Currently, Dogecoin is making an effort to return inside the ascending channel after several recent failed tests. This raises an important question: Is the current correction just part of the familiar pattern – or is it a signal that the technical pattern is starting to weaken?
Investors need to closely monitor DOGE's price reaction in the coming weeks, especially the ability to maintain this strategic support zone. A breakout back inside the channel could signal the start of the next bull cycle for this famous memecoin.
Not only Dogecoin, analyst Ali Martinez also gave an example from another memecoin, Pudgy Penguins (PENGU). In recent weeks, PENGU has formed a descending channel – a technical pattern opposite to the ascending channel – with lower highs and lows over time.
However, PENGU has just successfully broken the resistance line of the descending channel and is heading towards a price target of $0.041. This is evidence that: when prices break out of key technical channels, significant volatility often follows.
Dogecoin is currently at a key technical threshold – a place that has often served as a launching pad for major price increases in history. While there is no guarantee that history will repeat itself, technical analysis investors will certainly not overlook this promising signal.
In a market where sentiment can change rapidly, understanding and acting based on technical patterns can make a significant difference between observers and winners.