Dogecoin price has performed well this month, reaching $0.4795, its highest level since May 2021, as the broader crypto rally gained momentum.
Dogecoin (DOGE) traded at $0.40 on Nov. 28, marking a 365% increase from its September low.
This price action mirrored that of Bitcoin (BTC), which approached $100,000, setting a new record. Historically, Dogecoin and Bitcoin prices have moved in tandem. Data from IntoTheBlock reveals a correlation coefficient of 0.98 between the two, indicating similar price movements.
Therefore, there is a likelihood that Dogecoin will continue its strong bull run when Bitcoin crosses $100,000. In a recent Bitcoin analysis, we noted that technicals pointed to an eventual jump to $122,000. This view is based on the coin’s cup and handle pattern on the weekly chart.
As the name suggests, this pattern is made up of a rounded bottom followed by a pullback or a consolidation. Bitcoin’s handle lasted from March to earlier this month when it made a bullish breakout to $99,7000.
Bitcoin also has some strong seasonal fundamentals since its price often rises in November and December. On top of this, Trump is said to be considering Paul Atkins, who is popular in the crypto industry to be the next head of the Securities and Exchange Commission.
Spot Bitcoin ETFs have also gained traction, with total assets exceeding $101 billion, further boosting market confidence.
Dogecoin price rally to continue
Dogecoin’s price appears poised for further gains if Bitcoin climbs to $122,000 as projected.
On the weekly chart, Dogecoin has gone parabolic and crossed a critical resistance level at $0.2278, its March 2023 high, invalidating a previous double-top pattern.
The coin has also formed a golden cross pattern, with the 50-week and 200-week moving averages crossing, and has risen above the 50% Fibonacci Retracement level at $0.03715.
Dogecoin is now forming a bullish flag or pennant pattern, which often precedes a strong breakout. If this occurs, the next target could be $0.7400, its all-time high, representing an 85% gain from current levels. However, a drop below $0.2278 would invalidate this bullish outlook.
