The price of the leading memecoin, Dogecoin (DOGE), is forming a technical structure which, if completed, would involve upward momentum for the coin. This is a pattern known as a “double bottom” in financial markets.
Double bottom pattern refers to a price movement where two lows occur at approximately the same height. Thus, it is displayed as an inverted “U” in technical chart analysis.
This pattern can be seen in the following Trading View chart of the price of DOGE against Bitcoin (BTC). As seen there, quote 2024 is testing 0.00000167 BTC as a double bottom for the second time,
Double bottom movement shows that the market has retested strong support (an area of more demand than supply) for a boost. Therefore, it is a price level where the market again makes the minimum level and gains strength to overcome the downtrend.
That’s why this pattern Suggests a trend change from bearish to bullish, which is a positive sign for Dogecoin price, Of course, this happens if it completes the double bottom formation while rebounding from its current price. Otherwise, if it senses a drop from here, it will break this formation.
However, it should be noted that this formation is not guaranteed to reverse, it only estimates a possibility. Therefore, it is important to complement your analysis with others to have a comprehensive view of your potential movement.
What is increasing this bullish speculation is that the current prices of DOGE in Bitcoin act as a resistance zone (more supply than demand), which once the market managed to overcome, the currency will have hit a significant level. Experienced growth. To be precise, it happened three years ago, in April 2021, as seen below.
In what sense, The current price area proves to be a strong psychological level for the Dogecoin market, Which can act as a floor. This is because, with market momentum, traders turn historical resistances into supports.
An alternative climate is possible that will boost DOGE
This behavior of Dogecoin occurs when a potential altseason is underway, i.e. a season in which altcoins outperform Bitcoin. As reported by CryptoNoticias, this event follows an upward trend in BTC that increases demand for cryptocurrencies in general, which could be beneficial for Dogecoin if successful.
In turn, the creation of DOGE addresses is increasing, which has been shown as a positive sign for the market. And, as highlighted by investment company Galaxy, memecoins have historically made comebacks after long periods of low activity as is happening now.