Dogecoin’s price has been on a wild ride with a wave of steady declines in recent weeks. This decline has caused the meme coin to lose various support levels amidst a steady increase in selling pressure. Notably, this decline has resulted in a pullback of about 66% from the December 2024 high.
Such a 66% pullback is expected to cause concern among Dogecoin investors, but historical data suggests that such retracements are normal and often precede massive rallies. Crypto analyst Trader Tardigrade recently pointed out that Dogecoin has undergone two similar retracements since October 2022, both of which were followed by explosive price surges.
Dogecoin’s Trend Of Pullbacks And Explosive Recoveries
The latest Dogecoin correction may be difficult for bullish investors to cope with, but history suggests that such pullbacks have been precursors to massive price rallies since its 2021 all-time high. Looking at past trends, Dogecoin’s first major correction occurred after a rally in 2022, with the price dropping by 64% between October 2022 and June 2023. This steep decline was reversed later, leading to a massive 300% surge between July 2023 and March 2024.
A similar scenario unfolded during the second correction, which also saw a 64% dip from March 2024 to August 2024. But this time, the price skyrocketed by an even larger 500%. These two cycles have established a pattern that suggests Dogecoin’s current price action may not be unusual.
Trader Tardigrade’s analysis noted that the latest correction, which has seen Dogecoin decline by 66% from December 2024, fits within this historical pattern. As such, another significant price increase could be close if history repeats itself. Given that the previous rebounds resulted in triple-digit percentage gains, the possibility of another incoming rally cannot be ignored.
Could This Pullback Lead To A $1 Breakout?
The crypto analyst has hinted at the potential for a substantial price pump that could take Dogecoin toward the coveted $1 mark. Considering past rallies have resulted in 300% and 500% surges, a similar move from current levels could push Dogecoin into uncharted territory.
At the time of writing, Dogecoin is trading at $0.1587, down by 8.62% in the past 24 hours. A 300% move from here would translate to a price target of $0.64, its highest price point in years. On the other hand, a 500% move from the current price translates to a price target of $0.96, which would be an uncharted price level.
The first step in achieving this rally is the resumption of bullish sentiment in the crypto industry. The broader crypto market is currently gripped by extreme fear, with sentiment indicators sitting at a historically low reading of 15, the lowest in over two years.
Featured image from Adobe Stock, chart from Tradingview.com
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