Dogecoin (DOGE) Flashes a Tom Demark (TD) Sequential Sell Signal, But an Analyst Explains How the Parabolic Run Could Still Continue

Dogecoin Is Currently Showing A Pattern Similar To Previous Bull Runs

Dogecoin (CRYPTO: DOGE) has just showed a Tom Demark (TD) Sequential sell signal on the weekly timeframe, but an analysis by an analyst shows how the parabolic run could still continue for the memecoin.

What Happened: A new post on TradingView by analyst Ali Martinez discusses a TD Sequential signal that has formed for Dogecoin's weekly price recently.

The "TD Sequential" refers to a technical analysis (TA) indicator that points out probable tops and bottoms in an asset's price. This indicator involves two phases: the setup and the countdown.

During the first of these phases, candles of the same color are counted up to nine. Once the nine candles are in, the setup is said to be complete and a reversal in the asset may be expected.

Naturally, the price would start heading down if the candles leading up to the setup's completion were green, while it would catch an updraft if the candles were red.

As soon as the setup is over, the countdown begins. This phase of the indicator works similarly to the setup, except for the fact that it lasts for thirteen candles. After these thirteen candles are also in, the asset may be considered to have arrived at another likely point of turnaround.

As per the chart shared by the analyst, Dogecoin has recently completed the TD Sequential phase of the first type.

As is visible in the above graph, Dogecoin has finished the TD Sequential setup with nine green candles, which implies the indicator has just given a sell signal for the memecoin.

Considering the indictor's history, it's possible that this would lead to a drawdown for the asset. That said, history would also inform us of another thing, as Martinez has highlighted in the chart below.

It would appear that during each of the last two bull runs, DOGE observed a similar TD Sequential setup in the initial leg of the rally as the one witnessed recently. These signals led into declines for the coin, but the bearish momentum didn't last very long on either occasion, as the rally renewed each time after a temporary setback.

If this trend is to go by, it's possible that the latest TD Sequential sell signal may also prove to be only a minor obstacle on the way up for the cryptocurrency's price.

From the graph, it's also visible that the last two Dogecoin bull runs both fit neatly into an ascending parallel channel. The channel has also continued to hold in the current cycle so far, meaning that if DOGE is going to rise all the way toward its upper channel, it might break through the $14 mark.

It only remains to be seen, though, whether the asset would repeat the pattern or if this cycle is going to be different from the last two.

Price Action: In the last 24 hours, Dogecoin has hit the snooze with its price trading at $0.409, up 0.04% during the period.