Dogecoin (DOGE) is showing a similar price pattern to its behavior prior to the 8,000% rally in 2021, fueling speculation of another big breakout in the coming weeks.
DOGE’s consolidation trends reflect 2021.
DOGE’s price has rebounded 480% from its August 2024 low, including a 220% rise following Donald Trump’s presidential election victory in November. However, cryptocurrencies have now entered a period of consolidation.
DOGE/USD weekly price chart. Source: TradingView
In particular, DOGE is trading within a tight range of $0.39-$0.48, circled in red in the chart above, following a recent parabolic bounce. The consolidation phase mirrors that of early 2021, when Dogecoin experienced a strong rally followed by a sideways trend before another major breakout.
relevant: Dogecoin flips Porsche market cap as DOGE ETP, Musk drives rally.
A further similarity between 2021 and current Dogecoin price trends is the weekly Relative Strength Index (RSI).
As of December 2024, the weekly RSI has entered overbought territory above 70. This is a technical signal indicating a price correction or a prolonged sideways trend. However, in 2021, a similar overbought situation did not lead to a significant decline, but instead led to a continuation of the bull run.
If history repeats itself, DOGE could reflect an 85% price surge with an initial target of $0.75 by January 2025, as indicated by the Fibonacci retracement prediction.
source: X
Whale accumulation increases due to Elon Musk’s influence
On-chain data further supports the optimistic outlook.
Messari shows that addresses holding more than 1 million DOGE now hold 130.17 billion DOGE, an all-time high. The increase in whale address supply signals growing confidence in Dogecoin’s upward trajectory among large investors.
DOGE supplies addresses with more than 1 million tokens. Source: Messari
The 2021 rally saw a similar boom in DOGE supply held by whale addresses, with the number increasing from 110.31 billion to 112.46 billion.
DOGE supplies a balance of over 1 million tokens. Source: Messari
Elon Musk’s influence continues to play a key role in driving Dogecoin’s performance and increasing demand among whales. During the 2020-2021 rally, Musk’s frequent tweets in support of memecoins were instrumental in fueling the dramatic price surge.
A similar catalyst emerged recently with the launch of the Department of Government Efficiency (DOGE), humorously linked to Dogecoin’s ticker, DOGE. These developments have sparked renewed speculative interest in the world’s largest memecoin.
This article does not contain investment advice or recommendations. All investment and trading activities involve risk and readers should conduct their own research when making any decisions.