On Monday, seasoned crypto analyst Ali Martinez highlighted that Dogecoin is experiencing its tightest Bollinger Band squeeze since September 2023. According to him, DOGE could be on the verge of a major price move, most likely to the upside.
Dogecoin compression will lead to rally
Martinez shared the following DOGE daily chart, highlighting the multiple Bollinger Bands surrounding the memecoin’s candlesticks. As can be seen, the 3 Bands appear to be converging, which typically results in a major price movement for the underlying asset.
For the uninitiated, a Bollinger Band squeeze occurs when the upper and lower bands contract sharply, showing that price volatility has fallen to unusually low levels. It signals that volatility is building beneath the surface, and that a larger price move or breakout could soon be approaching.
In a separate price analysis thread, Martinez shared multiple bullish indicators that point toward a rally for DOGE. First, the TD Sequential indicator has flashed a buy signal for the memecoin on the monthly chart, pointing to a potential trend reversal.
The above chart is reminiscent of the move from August 2022, when DOGE formed an inverted hammer alongside a TD Sequential buy signal, followed by a doji candle. That whole price sequence was quickly followed by a 145 percent price move.
To explain, TD Sequential helps identify potential trend exhaustion, while an inverted hammer can signal a possible bullish reversal after a decline, and a doji candle reflects indecision between buyers and sellers.
When these 3 appear together, they can suggest that selling momentum is weakening and a potential reversal may be developing, though confirmation from subsequent price action is important.
DOGE whales are preparing for the move
Substantiating, Martinez said that according to on-chain data, DOGE whales appear to be getting themselves ready for the move. Over the past week, large holders have accumulated more than 430 million DOGE, adding conviction to the bullish technical setup.
The sustained conviction in DOGE is remarkable, especially after considering that the top memecoin by market cap has fallen more than 90 percent from its all-time high value.
If current bullish structure holds, DOGE could make a move as big as 200 percent. What’s more, on July 15, DOGE flashed a bullish pennant on the weekly chart, suggesting that it is ready for a lift-off.
