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Dogecoin Forecast into Crypto CPI Countdown

Steve Miley trader
Updated 12 Jan 2023

All eyes today across the world of financial markets will be on the release of the US Consumer Price index, CPI, a critical measure of inflation in the world’s biggest economy. We look at the prospects for cryptocurrencies into the key data event and focus on the price forecast for Dogecoin.

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Countdown to US CPI

Global financial markets, including the world of cryptocurrencies, are all awaiting the release from the US Labour Department in Washington at 08:30 ET of the latest CPI data, one of the Federal Reserve’s favoured inflation measures. This much-watched event has been particularly important since at least early 2022 as US and global inflation rates surged in the wake of a post-pandemic recovery that was dogged by supply constraints and also from the war in Ukraine.

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The past three releases of the data in 2022, since October all produced very aggressive price moves across global financial asset classes, including the world of decentralised finance, including cryptocurrencies, altcoins and meme coins. Moreover, the December release was particularly noteworthy, as trading volume in futures on the US 10 year Treasury Note surged in the minute leading up to the release of the data. Although there has been no official explanation for this activity, rumours remain that there was a leak or a hack.

According to the Bloomberg Economic Calendar, the expectation for the data is for an easing on the YoY number to 6.5% (down from 7.1% last) and for the MoM number to be flat, so cooling to 0.0% from prior 0.1%. We watch with much anticipation!

Dogecoin Sets Up Bullish into CPI

The meme coin, Dogecoin has been rallying steadily since the start of 2023 having rebounded from a multi-month swing low at 0.0660, at the very end of 2022. This was a potentially negative development from a charting perspective, as it undercut the swing supports that were established as a base back in November in the wake of the collapse of FTX, down at 0.0706/ 0713.

Source: IG.com

However, the solid and unform advance that has been produced since the start of 2023 (as seen across other financial market riskier asset classes and across the cryptocurrency space) has secured a short-term bottom, with today’s move ahead of the CPI release above the chart resistance at 0.0801, up to 0.0813 (so far today).

Dogecoin Trigger Levels and Price Forecasts

Upside Risks: A more robust push above the 0.0801 level post-CPI release today would reinforce at least a near-term basing pattern and probably an intermediate-term for January and into mid-Q1. Such a move would then open up a more bullish theme and target a January extension up towards 0.0956 and even 0.1118into mid-Q1 2023. Beyond here could even see the first quarter threat higher towards 0.1321 and potentially as high as 0.1587.
Downside Threats: A break down below 0.0498/0.0492, however, would neutralise any recovery and basing view and set a more negative tone again for January. This would then expose the ate 2022 low at 0.660 to a quick retest and then even open Q1 threats for a more bearish extension theme to challenge Q4 2022 lows at 0.0055/0551 and even as low as the 2022 bear markets lows at 0.0498/0.0492.


YOUR CAPITAL IS AT RISK. 81% OF RETAIL CFD ACCOUNTS LOSE MONEY.


Steve has 29 years of financial market experience including 3 years at Credit Suisse and 15 years at Merril Lynch. Steve is the Academic Dean for The London School of Wealth Management and has won many awards from Technical Analyst Magazine.