Why you should pay attention to Dogecoin price today

Dogecoin price has been consolidating inside a massive falling wedge pattern, that is edging closer to a breakout. A decisive move above the upper trend line could be the key to triggering an uptrend for DOGE.

Moreover, 4/20 is celebrated as a meme day, the chances of the original meme coin aka Dogecoin pumping are high. Therefore, investors need to keep a close eye on dog-themed coins that have the support of Tesla CEO, Elon Musk aka the Dogefather.

Dogecoin price to retrace its steps back higher

Dogecoin price crashed roughly 85% from its peak at $0.740 to $0.109 in roughly 308 days, This downswing has produced three distinctive lower highs and lower lows, which when connected using trend lines reveal a falling wedge pattern.

The said technical formation forecasts a 68% upswing, obtained by adding the distance between the first swing high and swing low to the breakout point. Since last week, Dogecoin price has edged closer to the upper trend line in an attempt to break higher. 

Interestingly, DOGE is already hovering above the upper trend line but a confirmation of the breakout is not here yet. Assuming a breakout occurs around $0.140, extrapolating shows that the target after a 68% upswing will be $0.233.

DOGE/USDT 1-week chart

Perhaps the most important on-chain metric that aptly reveals the bullish outlook for Dogecoin price is the 365-day Market Value to Realized Value (MVRV) 

This on-chain metric is used to determine the average profit/loss of investors that purchased DOGE over the past year. Based on Santiment’s research, a value below -10% indicates that short-term holders are at a loss and are less likely to sell. More often than not, this is where long-term holders accumulate. Hence, any move below -10% is termed an “opportunity zone.” 

For DOGE, the 365-day MVRV has been hovering below zero line since October 2021 and has been stuck below -30% since December 2021, indicating the wildly oversold nature of the altcoin and why it is bound to rally sooner rather than later.

DOGE 365-day MVRV

Regardless of the bullish narratives, a weekly candlestick close below $0.078 will invalidate the bullish outlook. In this situation, investors need to prepare for a potential crash to $0.048.