Crypto currency world’s biggest meme coin DOGE’s weekly price averages seem to be forming a strong golden cross pattern. The previous golden cross observed in January 2021 was a precursor to a price increase of 8,000%. Will the same price increase happen again?
Golden Cross Formation in Dogecoin
The reformation towards the “golden cross” technical formation, which predicted the rise seen in early 2021, excites DOGE investors. According to data, DOGE, with a market value of approximately 22 billion dollars, stands out this year with a price increase of over 70%, significantly outpacing Bitcoin’s approximate 50% rise.
Dogecoin’s spot price is currently showing an upward trend in its 50-week simple moving average. It is expected that DOGE will rise above its 200-day moving average in the coming weeks, creating a golden cross. This indicates that the short-term price momentum is likely to perform better than the long-term momentum in the near future, potentially turning into a long-term upward trend.
Investors following this momentum often prefer moving average crossings to determine the timing of market entry and exit. This method, used as part of a structured approach, helps investors to assess trends more clearly and make decisions.
A Rally Had Occurred Before
In March, DOGE’s price crossed beyond the 200-week Simple Moving Average (SMA), breaking out of a long-term horizontal consolidation and since then has formed solid support above this critical average. The upcoming golden cross will be the first cross seen in over three years. After the previous golden cross, a four-month rally followed in January 2021, during which prices surged over 8,000% to a record level of 76 cents on Binance.
However, past data is not necessarily a definitive indicator for future results. Meme coins like DOGE, lacking real-world use cases, are primarily based on speculation. This makes them more sensitive to liquidity conditions with fiat currencies and global interest rate expectations.
DOGE during its 2021 rise, global interest rates were near zero or below. This situation encouraged unprecedented risk-taking in financial markets. However, in major economies like the USA, interest rates are currently at the highest levels in recent years. Ultimately, this situation could affect assets like DOGE.
