An analyst has explained how Dogecoin (DOGE) could still have a chance at a parabolic run if the support level of this pattern ends up holding.

Analyst Explains Why Dogecoin Could Still Have A Chance At A Parabolic Run

In a new post on X, analyst Ali Martinez has shared a long-term Ascending Channel that the 1-week price of Dogecoin has been trading inside over the years.

The “Ascending Channel” here refers to a pattern from technical analysis (TA) that forms when an asset’s price observes consolidation towards a net upside between two parallel trendlines. The upper line of the channel is drawn by connecting successive higher highs. Similarly, the lower one joins higher lows. When the price is moving between these two lines, it’s likely to face resistance at the former level and support at the latter one.

In the scenario that the resistance or support line breaks, the asset can be likely to see a continuation of the trend in the direction of the break. This means that escapes above the channel can be bullish, while drops under it can be bearish.

There is also the Descending Channel, which occurs when the asset’s consolidation happens toward a net downside instead. But other than this fact, the latter works similarly to the former.

Finally, there is a third type of parallel channel, where the consolidation is exactly sideways. In this case, the trendlines are not only parallel to each other, but also to the time-axis.

Now, here is the chart shared by Martinez that shows the Ascending Channel that the weekly price of Dogecoin has seemingly been stuck inside for the past decade:

(Image Credit: Ali Martinez, additional editing by CC)As can be seen above, the 1-week price of Dogecoin has recently observed a sharp decline toward the bottom line of the Ascending Channel. Last year, the memecoin also made a retest of the line, which proved successful and helped its price find a rebound to the upside.

It’s possible that the line may once again end up holding for DOGE, but it’s still too early to say anything, considering that the last test saw the coin move along the line for a while before bullish momentum returned.

The latest retest of the line has come following a crash that has shaken assets across the cryptocurrency space and instilled fear in the minds of the investors. As long as DOGE stays inside the Ascending Channel, though, not all hope may be lost for the memecoin’s holders.

As the analyst says, “Dogecoin $DOGE still has a chance to go parabolic if the $0.16 support level holds! A decisive break below this level could open the door for further weakness in the coming weeks.”

Dogecoin has been one of the worst-hit top coins in the sector during the past week, as its price has plummeted almost 17%, bringing it down to the $0.17 level.