Dogecoin (DOGE) could be back in the top 10 cryptocurrencies by market capitalization, but its losses in terms of dollars and bitcoins (BTC) since Elon Musk’s appearance in SNL magazine are significant.
Dogecoin loses the Musk effect
The DOGE/BTC trading pair fell 75% after peaking at 1,287 satoshis on May 9, 2021, a day after Musk was a guest on Saturday Night Live, including in a skit titled “The Dogfather.”
Before his appearance, the billionaire entrepreneur tweeted relentlessly from Dogecoin memes, images, which helped DOGE, a cryptocurrency launched as a joke, reach a market cap of more than $ 90 billion in May 2021.
This represents an increase of more than 36,000% in just two years. However, things have gone downhill since then.
Investors were hoping that even an optimistic nod from Musk to SNL about DOGE would entice its 106 million followers to buy the meme-token. However, Musk did something unpredictable: he called Dogecoin a “scam”.
A day later, the price of Dogecoin began to fall from its all-time high. It continues the downward trend so far, falling from a peak value of 1,287 satoshis to around 300 satoshis.
At the same time, the price of Dogecoin has fallen over 90% against the US dollar after peaking at $0.76 in May 2021.
Elon Musk’s efforts to keep Dogecoin relevant
Elon Musk has made numerous attempts to revive people’s interest in Dogecoin since then.
In May 2021, it did reveal that it has been working with Dogecoin developers to improve its blockchain transaction efficiency since 2019. In addition, Musk’s Tesla and SpaceX have started accepting Dogecoin payments for their products, which led to a sharp spike in price, but short-lived.
In addition, Musk said during the stock market crash in March 2022 that he would not sell his cryptocurrency holdings, including those in DOGE and bitcoin. However, Tesla sold 75% of its bitcoin holdings three months after Musk’s statement.
As a general principle, for those seeking advice from this thread, it’s generally better to own physical things like a house or stock in companies you think make good products, than dollars when inflation is high.
I still own and will not sell my Bitcoin, Ethereum or Doge fwiw.
— Elon Musk (@elonmusk) March 14, 2022
As a general rule, for those seeking advice in this thread, it is better to own tangible assets, such as a house or shares of companies you believe make good commodities, rather than dollars when the high inflation. I still own and will not sell my bitcoin, ether or DOGE stock. — Elon Musk (@elonmusk) March 14, 2022
The prospect of DOGE’s payment option with Twitter also fell apart after Musk backed the purchase of the social media giant.
In September 2022, Tesla launched Cyberwhistle, a limited edition collectible inspired by its Cybertruck vehicle, which users can only purchase through Dogecoin.
Will Dogecoin Bounce Back?
Traders have begun to ignore Musk’s famous association with Dogecoin, given their mixed reactions to his recent DOGE-related updates.
Instead, traders appear to be more focused on recent macro catalysts, mainly the Federal Reserve’s successive interest rate hikes that have put downward pressure on cryptocurrencies, stocks and similar risk assets in 2022 and beyond.
Also Read: Dogecoin Is The Second Largest PoW-Based Cryptocurrency
Technical arrangements also suggest the same. For example, on the weekly chart, the DOGE/BTC pair is now testing the 307 satoshis level as interim support, given the history of this level as a strong price floor since November 2021.
A decisive break below 307 satoshis would allow the DOGE/BTC pair to test its 200-week exponential moving average (200-week EMA; the blue wave) near 244 satoshis as a downside target in 2022, a 20% decline. .
40% fall against the dollar
DOGE price has been trending inside a wide descending channel against the US Dollar since a peak in May 2021, and is now targeting its lower trendline as the next target below.
The target appears to be within the defined range between $0.048 and $0.036 given the history of these levels as support. Therefore, the DOGE could fall by around 40% against the dollar in the fourth quarter of 2022.
The views and opinions expressed herein are solely those of the author and do not necessarily reflect those of Cointelegraph.com. All investment and trading involves risk, you should do your own research before making a decision.
