Dogecoin (CRYPTO:DOGE) has been on a tear since March 23, and there’s speculation that the digital currency could see even more gains in the coming weeks.
One reason for this is that Tesla (NASDAQ: TSLA) and SpaceX CEO Elon Musk has become the largest shareholder in Twitter (NYSE:TWTR). And as we all know, Musk is a big fan of dogecoin. In fact, Tesla accepts DOGE payments on its online merchandise store. On top of that, Musk has even called himself the “Dogefather.” So it’s not surprising that many people believe that his involvement with Twitter could lead to more people talking about DOGE and driving up its price.
Only time will tell if this speculation is true, but dogecoin investors are certainly hopeful that Musk’s involvement will lead to even more gains for the digital currency.
In fact, on Monday, the value of the original meme coin surged by 10% to reach above $0.155, an almost two-month high, after Musk revealed that he had accumulated a 9.2% stake, worth about $2.9 billion, in Twitter.
Following his investment announcement, which comes as no surprise given that Musk has been critical of the social media company in the past, dogecoin’s price-surge added more than $1.5 billion to the coin’s market cap in less than one hour.
In a comment to Coindesk, MinePle’s Alexander Mamasidikov said that “Dogecoin stands to gain a lot in the near term if Musk utilizes Twitter to further promote the coin as he has been doing, however this time, without the ominous fears of being restricted. Should the buyup momentum be sustained, Dogecoin might break the $0.2 resistance in the near term.”
Dogecoin’s yearly price chart shows a string of lower lows, suggesting a bearish pattern in progress. For DOGE to retest the $0.20 resistance, it needs to consolidate first above the $0.15 level and then as it flips this crucial area into a support floor, break through the $0.17 and $0.19 hurdles to rally about 34% (from $0.15) to $0.20.
Prominent crypto trading expert Ali Martinez had stated that DOGE could advance towards $0.21 “with no hesitation,” even before Musk’s Twitter-stake announcement had an effect on the coin’s price action.
“On-chain data shows that Dogecoin could be free to advance towards $0.21 with no hesitation. But around this price point, DOGE could face stiff resistance as more than 631,000 addresses holding over 48 billion DOGE are underwater.”
DOGE Price Action
DOGE was trading 7.5% higher at $0.154 late in Wednesday’s session. The meme coin is down about 10% year-to-date and 77% year-over-year. Its market cap currently stands at $20.5 billion.
Disclaimer: The information on this site should not be considered investment advice
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