The price of Dogecoin (DOGE) increased significantly on January 14 when Elon Musk revealed that Tesla will begin taking the cryptocurrency as payment for merchandise.

Following the news, the price of DOGE increased by approximately 13 percent, reaching a 30-day high of $0.2150. A broader intraday surge was already underway when Musk’s Dogecoin tweet went viral, and the cryptocurrency’s upward movement was a part of that rally.

The price of DOGE increased by more than 25% on January 14 before correcting down to $0.1986 as a result of profit-taking.

DOGE/USD hourly price chart. Source: TradingView
DOGE/USD hourly price chart. Source: TradingView
Better than Bitcoin

Tesla’s integration of a DOGE payment option on its online shopping platform comes almost a month after Musk expressed his openness to accept the cryptocurrency as payment on a trial basis.

The “better-than-Bitcoin” features of DOGE, notably as a payment alternative because of its lower power usage, were at the center of Musk’s interest for it. Following are extracts from Musk’s remarks to Time Magazine, in which he explains:

“Fundamentally, Bitcoin is not a good substitute for transactional currency. Even though it was created as a silly joke, Dogecoin is better suited for transactions.”

The millionaire entrepreneur said that Bitcoin’s cost per transaction is high, even though its transactional volume is minimal compared to the dollar. Consequently, Bitcoin may be ideally suited to serving as a store of value asset in the future. On the other hand, DOGE may keep pushing individuals to spend indefinitely.

What is the future of DOGE?

When DOGE challenged a multi-month resistance trendline in the hopes of achieving a topside breakthrough, the recent wave of buying waned slightly in the Dogecoin market.

Further, according to the data, the price surge in DOGE was slammed against falling trendline resistance that has been sapping the stock’s upward efforts since May 2021. As demonstrated in the chart below, the trendline was once again crucial in driving DOGE from its intraday high of $0.2150 to $0.1958 on January 14, as shown in the chart above.

DOGE/USD daily price chart. Source: TradingView
DOGE/USD daily price chart. Source: TradingView

The Dogecoin’s 200-day exponential moving average (200-day EMA; also known as the orange wave) also played an essential part in restraining the cryptocurrency’s advances on January 14. The resistance confluence, taken together, suggested that the price of DOGE may reverse course from its current rise in the following days.

If this occurs, the token would seem prepared to test its 50-day exponential moving average (the velvet wave) as support, with the chance of extending its correction towards $0.1367 due to its recent history serving as support.

DOGE/USD daily price chart. Source: TradingView
DOGE/USD daily price chart. Source: TradingView

A significant breach over the descending trendline resistance and the 200-day exponential moving average, on the other hand, might lead traders to seek $0.30 as their next upward goal in the Dogecoin market. Previously, the region around the $0.30-level had functioned as a point of resistance.

Leave a Reply

Your email address will not be published. Required fields are marked *

oZone News Instagram