The movement in the price is forming a falling wedge, indicating an accumulation that adds to the drop in volatility to predict a new rise. There could be aggressive conditions for the markets that would invalidate previous forecasts, leading the price to around USD 0.0043.
Billy Markus from Portland, Oregon, and Jackson Palmer from Sydney, Australia, forked Dogecoin (DOGE) from Litecoin (LTC) in December 2013. They created it as a playful cryptocurrency that would have a higher appeal beyond the core audience of Bitcoin.
Over the last few years, billionaire businessman Elon Musk tweeted that DOGE was his favorite currency. He also said he planned to accept it as a payment method for the electric cars his company made.
Dogecoin was among the TOP 10 cryptocurrencies by market capitalization but has dropped several levels until ranking 13th. However, Musk has expressed his support for it at every possible opportunity.
Several Factors Influence the Price of Dogecoin
Over the last six months, DOGE lost about 70% of its value as other global markets declined, fearing aggressive policies by Fed Chairman Jerome Powell.
Following that considerable correction, the DOGE price is at significant levels and is about to reach the accumulation range before 2020. It has also broken through the 79% Fibonacci retracement levels.
At the moment, it is forming a falling wedge, which indicates an accumulation. That adds to the drop in volatility to predict a new rise in the value of Dogecoin.
The Relative Strength Index (RSI) is in a bearish area of 38.47%, unfavorable for the price. However, the trend structure it is forming leads to thinking of confirmation of the anticipated accumulation.
Since Bitcoin (BTC) leads the way in the cryptocurrency market, a rise in its price would confirm a forecast on DOGE for the coming weeks. BTC is above the dynamic support that forms a bullish triangle and has a support level between USD 38,000 and USD 43,000.
BTC is a risky asset, but higher stability by the Fed and peaceful negotiations in Ukraine would provide the conditions to confirm the proposed scenario.
There Is a Bearish Possibility on the Horizon
These projections rely on the information collected so far against new information, but they could change. With good risk management, the worst scenario is that the opposite of the above predictions about this market happens.
Before the Fed holds a new meeting in May, aggressive market conditions would invalidate previous analyses. El Salvador could cancel its BTC bonds due to pressure from the IMF, or the war in Ukraine could escalate. Amid that scenario, the DOGE price would reach around USD 0.0043.
The Dogecoin market is expecting events other than those related to the war. The sights are on the imminent launch of Salvadoran Bitcoin-based bonds, the ruling favoring Bitcoin mining in the European Parliament, and the decision of the Fed.
DOGE is trading at around USD 0.119 and has accumulated a 0.2% loss over the last 24 hours. Its daily trading volume is above USD 363.98 million, and its market capitalization is about USD 15.87 billion, according to CoinGecko.
Emulating the rest of the altcoin market, the value of the meme coin dropped by about 83.6% from its all-time high at USD 0.731.
By Alexander Salazar
