Dogecoin was first launched on Dec 6, 2013. Since then, it has been the subject of a remarkable rise to prominence. It was created by Jackson Palmer and Billy Markus, based on the Shiba Inu meme.
Even though the cryptocurrency was not taken seriously at its inception, Dogecoin has developed into an important asset, having a market capitalization of $283 million as of October 2019, and ranked 29th based on its market cap.
Additionally, Dogecoin enjoys some real-world applications and is sometimes used for tipping on the internet to reward helpful posts
After climbing to its all-time high value of over $0.0185 back in January of 2018, Dogecoin began to experience a downtrend that lasted until January 2019.
Nevertheless, Dogecoin remains a cryptocurrency with significant appeal and appears unlikely to disappear in the near future. Taking that into consideration, let’s take a look at the current state of its price movement and look ahead to its potentially bright future.
Important High and Lows
During its history, Dogecoin has reached several significant highs and lows, some of which will be used in this analysis.
The most significant are given in the table below:
|January 28, 2016 – $0.00051||May 7 2015 – $0.000068|
|June 6, 2017 – $0.00410||September 15, 2017-$0.00065|
|January 7, 2018 – $0.01972||February 6, 2019, $0.00174|
Average Rate of Increase
Looking at the price of Dogecoin since its inception, we can see a very interesting trend line that has been in place since the beginning of 2015.
The line acted as resistance until May of 2017, when the price finally broke out. Afterward, it acted as resistance beginning in September 2017. The price recently dropped and validated it in September 2019.
We can use this line to measure the average rate of increase. However, it would not be accurate in predicting the price on an exact date, since we cannot know how far the price is from the support/resistance line.
Just going by the line, we have a price of $0.0022 and $0.0036 at the end of 2019 and 2020 respectively.
A slightly better way to measure the price at a certain date would be using the average rate of increase.
Since the support line was created, on Aug 4, 2014, the price has increased by 3112% over 1876 days.
This amounts to an average rate of increase of 1.63% per day. Using that, we arrive at a price of $0.0055 and $0.0191 at the end of 2019 and 2020, respectively.
Additionally, we get a price of $0.072 in Dec 2024.
However, there are several drawbacks to using this method.
Since the price of DOGE has been historically volatile, we cannot determine how much faster or slower than its average rate DOGE will be at an exact point in time.
However, this method might be suitable for predicting the price in 2024, since it should return to the average rate of increase at some point in time.
Therefore, we will use technical indicators and fractals in order to predict the price and then check with these predictions to see if they support them.
In order to predict the price at the end of 2019 and 2020, we want to find similarities between price movement at certain points in time.
Doing that we have identified nine instances in which the daily RSI was below 30. A low RSI value indicates oversold conditions.
Therefore, we have added the 100 and 200-day moving averages (MA, yellow and blue) into the analysis.
We want to identify low RSI values which also occur when the price is below both MAs which have previously made a bearish cross (Yellow line is below the blue line)
Doing so, we find only three instances that fit our criteria:
- April 13, 2015
- November 14, 2018
- September 25, 2019
(Feb 8, 2019, also fits the criteria but we consider it an extension of the movement that began on Nov 14, 2018)
Assuming that the price is at a similar place in its market cycle during these dates, we are going to make predictions for the price on a date in the future.
After April 13, 2015, it took the price 288 days to reach its local high. This amounted to an increase of 433% and gives an average daily rate of increase of 1.50%.
After Nov 14, 2018, it took the price 233 days to reach its local high and increase by 98%. This is a rate of increase of 0.42% per day.
Therefore, comparing the ratios of these two moves, we realize that the second is faster, transpiring 1.25 times quicker than the first. However, it has a much smaller magnitude of only 22% of the first move.
Assuming that a similar movement will occur after the Sept 25, 2019 low, the price should gradually increase for the next 250 days amounting to a total increase anywhere between 100% and 400%.
However, when looking at the two upward moves analyzed previously, we can see similarities between the 25 Sept 25, 2019, and Aug 1, 2016 lows.
This does not nullify our hypothesis that a move similar to the one in April 2015 and Nov 2018 will occur soon. Rather, it suggests that the move beginning in Nov 2018 has not yet finished and we are approaching its final phase.
This means that we could see the price consolidate close to the support line for a period of time before beginning a very rapid upward move.
Dogecoin Price Prediction 2019
Until now, we have found out that the price movements on April 13, 2015, and Nov 14, 2018, share several similarities. However, the movement after Nov 14 occurs 1.25 times faster than that of April 13 and has a magnitude of only 0.22 of the same move.
Using these ratios, we can find the date after April 13, 2015, that corresponds with Dec 31, 2019.
On March 6, 2016, the DOGE price was $0.00022. Measuring from the price on April 13, 2015, that is an increase of 122%.
Measuring from the price on Nov 14, 2018, and applying the 0,22 magnitude ratio, we get a price of $0.00297 for Dec 31, 2019.
The $0.00297 price does not fit with our prediction based on the average rate of increase.
This is to be expected since it is a relatively short-term prediction.
However, it fits perfectly well with the hypothesis that the price is likely to consolidate near the support line before beginning a rapid upward move.
We are Nearing the end of 2019, this rapid upward move has yet to begin.
Dogecoin Price Prediction 2020
In order to predict the price at the end of 2020, we are going to use the same method used to predict the price at the end of 2019.
If the moves that began on April 13, 2015, and Nov 14, 2018, are similar, then the difference in price from April 13, 2015, through Dec 14, 2017, will be similar to Nov 14, 2018, through Dec 31, 2020.
On Dec 14, 2017, the DOGE price was $0.034. Measuring from the price on April 13, 2015, that is an increase of 3470%.
Using our 0.22 magnitude ratio, we find a price of $0.0201 on Dec 31, 2020.
The price should consolidate until July 2020, when it should accelerate its rate of increase and reach a double top near the all-time high price.
Dogecoin Price Prediction 2024
In order to predict the price at the end of 2024, it is not possible to use the RSI or moving averages.
This is because the date is close to five years from now, and both our market cycles (April 2015, November 2018) lasted only for roughly one and a half years. Thus, if we were to use them to predict the price, we would have to do a prediction based on a projected price in the future.
Therefore, we will use the average rate of increase discussed in the first section.
Given an average rate of increase of 1.63% per day, we find a price of $0.072 on Dec 31, 2024.
The predicted prices with both methods are given in full in the table below:
|Average Rate of Increase||RSI & Moving Averages|
|December 31, 2019||$0.0055||$0.00297|
|December 31, 2020||$0.0191||$0.0201|
|December 31, 2024||
We believe the price prediction by the RSI & Moving Averages will turn out to be more accurate. This is especially the case for the price prediction at the end of 2019.
On the other hand, both price predictions for the end of 2020 are quite similar.
The price prediction for 2024 is done using the average rate of increase.
Do you think our predictions are accurate? Which one of them is more likely to be reached? Do you like the methods using to come to the predictions? Let us know your thoughts in the comments below.
Disclaimer: This article is not trading advice and should not be construed as such. Always consult a trained financial professional before investing in cryptocurrencies, as the market is particularly volatile.
Do you want to BeInCrypto? Join our Telegram Trading Community for exclusive trading signals, educational content, discussions and project reviews! Images courtesy of Shutterstock, Trading View and Twitter.