Dogecoin's 5-Month Downtrend 'Countdown'... Will It Surpass Its All-Time High?

▲ Dogecoin (DOGE), Whale/AI-Generated Image

Dogecoin (DOGE) is reportedly preparing for a so-called “Last Dance” toward a new all-time high, supported by its strong correlation with Bitcoin (BTC) and what analysts describe as the final bullish cycle under Elliott Wave theory.

According to cryptocurrency media outlet BeInCrypto on February 28 (local time), Dogecoin is showing signs of attempting a new short-term rally after breaking a five-month consecutive downtrend. Swissblock’s Altcoin Vector, an institutional altcoin research platform, noted that its proprietary “Impulse Index,” which measures Dogecoin’s momentum, is flashing a strong bullish signal. Such movement in the indicator could serve as a decisive catalyst for triggering a fresh price rally in Dogecoin.

One of the key factors supporting the possibility of a rebound is Dogecoin’s close correlation with Bitcoin. Data from DefiLlama shows that the one-month and seven-day correlation coefficients between Bitcoin and Dogecoin stand at 0.83 and 0.88, respectively—both considered very high levels. As Bitcoin recovered from $62,700 to $67,700 in the final week of February, attracting bargain-buying interest, expectations are growing that Dogecoin could follow suit with a parallel rise.

Henrik Zeberg, a macro strategist at Swissblock, presented a highly bullish scenario for Dogecoin using Elliott Wave theory. Zeberg assessed that Dogecoin has moved past wave four and is preparing to enter wave five—the final upward phase of a larger cycle. Citing historical instances where wave one delivered a 22-fold gain and wave three surged 65-fold, he projected that the upcoming fifth wave could generate returns ranging from 25 to 53 times.

Optimism is also spreading among technical analysts regarding the formation of a breakout pattern. Trader Tardigrade analyzed that Dogecoin is compressing energy within a converging triangle pattern, characterized by lower highs and higher lows. This type of price compression often precedes a strong upward breakout. If a breakout materializes, Dogecoin is expected to quickly retest major resistance levels, potentially igniting the final surge of the current cycle.

However, some point out that Dogecoin’s genuine recovery will require more than technical indicators and will need a powerful catalyst. As a large-cap asset with a market capitalization exceeding $16 billion and daily trading volume surpassing $1 billion, Dogecoin will require a compelling new narrative capable of attracting substantial public capital inflows beyond a simple chart breakout. Movements by influential figures such as Elon Musk or major headline-grabbing news events are expected to be key factors in completing Dogecoin’s “Last Dance.”

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