Top 3 reasons Dogecoin price is on the cusp of a breakout

Dogecoin price retreated and moved into a technical bear market after falling by over 23% from its highest point this month.

Dogecoin (DOGE) plunged to a low of $0.2200, its lowest level since July 18, mirroring the performance of most meme coins. Still, there are three potential reasons why DOGE price will rebound soon:

• Dogecoin price has formed a golden cross pattern.
• Spot DOGE ETF approval hopes.
• Potential crypto market rally.

Dogecoin price has strong technicals

The first reason why DOGE price may rebound soon is that it has formed the highly bullish golden cross pattern on the daily chart. This pattern happens when the 50-day moving average crosses above the 200-day moving average.

A golden cross often leads to a prolonged upside. For example, DOGE formed a golden cross in October last year and then advanced by over 270% shortly afterward.

Dogecoin price formed a double-bottom pattern at $0.1467 and a neckline at $0.2596, its highest point in May. The distance between the neckline and the double-bottom pattern is 44%. Measuring the same distance from the neckline gives it a target of $0.3763.

DOGE price is also in the second stage of the Elliott Wave pattern. This corrective wave is then followed by the third one, which is usually bullish and the longest of the cycle.

Rising DOGE ETF approval odds

The other main reason why the Dogecoin price may surge soon is the rising odds that the Securities and Exchange Commission will approve a spot DOGE ETF this year. Odds that this approval will happen have jumped to 75%.

Companies like Grayscale, Bitwise, REX Shares, and 21Shares have all filed for a DOGE ETF with the SEC. Odds of approval are high because Dogecoin is a proof-of-work coin like Bitcoin (BTC) and Ethereum. 

An approval would likely lead to more inflows, as BTC and ETH have experienced. Bitcoin ETF inflows have jumped close to $56 billion, while Ethereum has close to $10 billion.

Potential crypto market rally

Dogecoin price will likely rebound because of the potential crypto market rally now that the Bitcoin price has formed a bullish pennant pattern on the daily chart. That pattern suggests an eventual rebound, which will likely lead to further gains among altcoins like Dogecoin and Pepe.