Dogecoin And The FOMC: Here's What Will Happen To Price If The Announcement Is Favorable Like 2021

Source: Bitcoinist

As the Federal Open Market Committee (FOMC) meeting approaches, analysts closely watch the Dogecoin price movements, drawing parallels to its explosive rally in 2021. Historical trends suggest a favorable FOMC announcement could significantly impact the Dogecoin price, potentially triggering a rally.

Dogecoin Price Rally Linked To FOMC Decision

Back in January 2021, the FOMC opted to keep rates unchanged, aiming to maintain ample liquidity in the United States (US) financial markets. This decision triggered a massive shift in Dogecoin, with the meme’s price skyrocketing the next day.

A crypto analyst, ChandlerCharts, recently shared an analysis of the FOMC’s influence on Dogecoin’s future performance. Comparing two parallel charts, the analyst drew striking similarities between the Dogecoin price action in January 2021 and 2025, both of which coincided with scheduled FOMC meetings.

The left chart shows that in January 2021, Dogecoin experienced a massive rally, surging well above the 0.618 Fibonacci extension level at the $0.01 price point. At the time, the rally coincided with the FOMC meeting and the US Presidential inauguration, with the Federal Reserve’s rate announcement serving as a key catalyst to Dogecoin’s upward momentum.

Connect between FOMC Meetings and DOGE’s price | Source: Chandler on X

Chandler illustrates Dogecoin’s current price structure on the right chart, with a similar historically bullish pattern unfolding. DOGE is hovering around the key 0.382 Fibonacci level at the $0.33 price point. This zone, acting as a support area, was previously a launchpad for the Dogecoin price rally after the FOMC announcement in 2021.

DOGE is currently testing the $0.33 key support level, just like it did in 2021. Its current price action leading up to January 2025 mirrors historical patterns, highlighting a significant rally above the 0.618 Fib, a peak at the 1.0 Fibonacci level, and a subsequent retracement to the 0.236 Fib.

If history repeats itself and the upcoming FOMC on January 28 to 29 favors liquidity as it did in 2021, Chandler predicts that Dogecoin could skyrocket to $0.5, corresponding to the 0.618 Fibonacci level. The analyst also forecasts that similar market conditions could trigger a stronger rally to the $0.7 market peak at the 1.0 Fibonacci level.

Based on this bullish forecast, Chandler warns investors and traders to “brace themselves” as volatility is expected to rise leading up to the FOMC announcement. While history doesn’t always determine future market movements, the similarities in market sentiment and liquidity conditions from a favorable rate decision make this a pivotal moment for the DOGE price.

Bearish Or Bullish? Upcoming FOMC Meeting Sets The Tone

Historically, the FOMC meeting held eight times a year tends to influence the crypto market, as it offers insights into the FED’s monetary policy decision. Commenting on this, Daitaro, a crypto analyst on X, revealed that the crypto market often displays bearish or bullish sentiment leading up to the FOMC meetings.

Following the FOMC’s rate announcement, real price action occurs, leading to either a pump or dump in top cryptocurrencies like Bitcoin and Dogecoin, among others. With the FOMC meeting set for today and tomorrow, the market’s reaction to a favorable or negative decision could significantly impact crypto prices.