Will DOGE Rise Again? What Has Musk Done to Dogecoin?

Musk Retweets Dogecoin Tweet

Today (July 26th), Elon Musk, the founder of SpaceX, investor in Tesla, co-founder of OpenAI, and CEO of Twitter (now renamed X), retweeted a video tweet about Dogecoin's involvement, causing Dogecoin (DOGE) to surge in response with nearly a 10% increase in the past 24 hours.

Elon Musk Retweets X Video Released by Dogecoin, Source: X.

The recent upward trend in Dogecoin's price is indeed related to Musk's actions, but part of the credit goes to DOGE whales. In a situation where market confidence was lacking, these whales heavily bought Dogecoin, driving its price up and further attracting more funds.

According to OKX data, the trading volume of DOGE is close to $100 million, ranking second only to Bitcoin (BTC). Additionally, according to CoinMarketCap, DOGE has made it to the popular list, trailing behind Ripple (XRP) and Worldcoin (WLD).

Will DOGE continue to rise?

Currently, according to IntoTheBlock data, 57% of DOGE coin holders are in a profitable position, 40% are at a loss, and the remaining 3% are break-even. So, will the profit-taking behavior of profitable holders lead to a sell-off? What will happen to Dogecoin next, a rise or a fall?

Currently, DOGE is priced at $0.08, positioned within the range of $0.05-$0.1, with a void above. Market makers often choose to push the price higher before selling off. However, when approaching $0.1, there is strong selling pressure because previous attempts to break through this level have failed. Short-term investors often choose to sell at this level and wait for a clear direction before buying back in. In other words, DOGE still has upward potential.

Dogecoin Price Trend from January 2022 to July 2023, Source: TradingView.

How much will DOGE rise?

Here's the question: Does DOGE have any hope of breaking through the first resistance level at $0.1? Or even challenge the $0.15 mark? Although Dogecoin has experienced a surge this time due to Musk's catalyst, it is ultimately just a hot topic that is difficult to sustain. Moreover, we are currently in a bear market, and DOGE itself lacks anticipated events or positive news.

Dogecoin Price Trend from January 2022 to July 2023, Source: TradingView.

However, if there is a future interest rate cut by the Federal Reserve or the approval of a Bitcoin spot ETF, there will be an influx of off-exchange funds, and DOGE, as a mainstream coin, will benefit. In such a scenario, there is a possibility for DOGE to challenge the second resistance level at $0.15.

From a technical perspective, there is a higher likelihood of DOGE rising. However, the impact of news cannot be ignored. The interest rate decision will be announced tomorrow (July 27), and there is also non-farm payroll data in August. These factors can significantly influence the price movement of cryptocurrencies. Therefore, it is crucial to stay updated when engaging in trading activities.