Dogecoin has been drifting around the $0.17 price level and has struggled to find bullish direction in a market that remains overwhelmingly bearish. Crypto prices have been bleeding across the board, with Bitcoin and other major assets showing signs of exhaustion.
Amid this downturn, a recent development shows that a reversal might be brewing for the meme coin. This recent development is revealed through Dogecoin’s latest weekly close, which closed with a candlestick often associated with trend reversals.
Dogecoin Closes Week With Doji Candle: What Does This Mean?
Dogecoin closed out last week with a Doji candle, with a long downside wick and a thin body. Interestingly, crypto analyst Trader Tardigrade noted on social media platform X that this Doji weekly close is an interesting development for Dogecoin, considering what happened the last time the meme coin had such weekly close. According to Trader Tardigrade, this specific close could mark the end of the current downtrend and a potential shift toward recovery.
A Doji candle occurs when the open and close prices are nearly identical, reflecting market indecision. As such, the latest weekly Doji candle reflects the indecision DOGE went through last week as the bulls worked to prevent a continued price decline from the previous week.
In the case of the recent Dogecoin Dogi candle, the specific candle has a longer lower wick compared to the upper wick. This is because the week started on a continued decline from the previous week, essentially pushing DOGE to a low of $0.142, which is its lowest point in four months. However, the Dogecoin price eventually closed the week at $0.16818, just a little bit above its open price of $0.16802.
DOGE’s History With Doji Candles And Price Surges
Trader Tardigrade highlighted that the last time Dogecoin printed a Doji on the weekly timeframe, it preceded a significant price rally. As shown by the DOGE weekly candlestick timeframe chart above, the last time such a Doji happened was in the first week of October 2024. At the time, Dogecoin closed around the week at $0.11. After this close, the meme coin went on a 340% rally that lasted the next eight weeks, reaching a multi-year peak of $0.486.
The question now is whether this setup will play out similarly in the current environment or if the current bearish sentiment will override any chance of a reversal. Unlike October 2024, the current market conditions are overwhelmingly bearish, with crypto assets struggling to find a foothold amid persistent selling pressure.
While this Doji weekly candlestick alone isn’t enough to confirm an uptrend, the bullish outlook is that Dogecoin replays its previous performance. A similar 340% rally from the latest Doji close of $0.16818 will put DOGE at a price target of $0.75.
At the time of writing, Dogecoin is trading at $0.1740.
Featured image from Unsplash, chart from Tradingview.com
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