Dogecoin price has crashed into a strong bear market this year as it crashed from the December high of $0.4845 to $0.265. It has erased some of the gains made in 2024 as the crypto fear and greed index has moved to the fear zone. This article provides an unbiased DOGE forecast and assesses whether it can stage a strong comeback and hit $1 soon.
Why Dogecoin price crashed
The Dogecoin price has collapsed this year for three main reasons. First, the price action is mostly due to Bitcoin remaining in a tight range in the past few months. It has remained inside the support and resistance levels of $90,000 and $109,000.
Bitcoin usually sets the tone in the crypto industry, and when it falls or stagnates, investors dump other tokens.
Second, Dogecoin price has dropped as investors sell the news. The coin jumped ahead of Donald Trump’s inauguration in January. In most cases, assets rise ahead of a major news event and then fall when the news event happens.
Trump’s inauguration was important for the Dogecoin price because he appointed Elon Musk to head the Department of Government Efficiency (DOGE). Musk has already become the most powerful individual in the government today.
Third, DOGE price has retreated because of the falling greed in the crypto market. The closely watched fear and greed index has dropped to the fear zone of 39. A move from the extreme greed zone of 88 in 2024 to 39 is a sign that investors will remain in the sideline.
DOGE price chart | Source: TradingView
Elliot Wave points to a DOGE price rebound
The weekly chart shows that the DOGE price has remained under pressure in the past few weeks. It has dropped from a high of $0.4832 in December to a low of $0.20.
This decline was notable because the coin retested the key support level at $0.22278, the highest swing in March last year. This situation is known as a break and retest pattern and is a popular sign of continuation.
Further, the decline is part of the second phase of the Elliot Wave performance. For starters, Elliot Wave has five phases, with the first one being bullish and the second one being a retracement. The first phase started in September last year, while the second one is underway.
The third phase is usually the longest, and in Dogecoin’s case, it will likely end at an all-time high of $0.7600. It will then retreat and retest the 23.6% Fibonacci Retracement level. Finally, the coin will jump to the resistance at $1, up by 276% from the current level.
The main caveat is that this analysis uses the weekly chart, where patterns take time to form. For example, the second wave has taken over two months to form. Therefore, the Dogecoin price eventual surge to $1 will likely take more time to form.
The bullish outlook will become invalid if the Dogecoin price crashes below the key support at $0.0835, its lowest level in July last year.
Other catalysts for Dogecoin
There are other catalysts that may push the Dogecoin price higher in the long term. First, the ongoing retracement is part of the coin’s recovery. While the DOGE price’s 53% crash is a steep one, it is smaller than the 63% crash that happened last year when it dropped from $0.278 to $0.0834.
Second, there are rising odds that the Securities and Exchange Commission (SEC) will approve a spot DOGE ETF this year. While DOGE is a meme coin, it is similar to Bitcoin since it is a proof-of-work token that the SEC sees as a digital commodity.
Further, Dogecoin price will be boosted by the eventual Bitcoin price rebound. Bitcoin has formed the bullish flag chart pattern, a popular continuation sign.
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