The Tesla founder and CEO posted tweets in support of Dogecoin insofar that he ended up calling himself “the Dogefather” in jest, while also recently stating that he’s “Dogecoin’s master.”
Musk’s popularity became instrumental in pushing the DOGE/USD bids up by more than 15,300% in 2021, with its market capitalization hitting $92 billion, surpassing even Airbnb and Infosys.
But the supersonic price rally has also invited fear, uncertainty and doubt, or FUD, of a potential bubble. The panic almost engulfed the market after Musk called Dogecoin a “hustle” during his television appearance on Saturday Night Live on May 8, leading to a 45% price decline in the next three daily sessions.
The sell-off intensified further on May 19 amid a market-wide brutal sell-off. Dogecoin fell to as low as $0.29, down more than 74% from its all-time high of $0.76.
GameStop Corp.’s and Dogecoin’s supercharged rallies created threats to financial stability.
As a sign of Dogecoin’s rising popularity, the Robinhood app is among the top 10 downloads at the Apple App Store. Meanwhile, Coinbase Global, the largest U.S. crypto exchange, doesn’t offer Doge trading.
It saw its shares fall more than 6% Tuesday. The stock is on track for the lowest close since its market debut last month.
“It’s pretty amazing that something that started out as a joke has become so popular,” said Matt Maley, chief market strategist for Miller Tabak + Co.
Though interest in digital assets has picked up in recent months as more traditional firms who were long hesitant to the crypto space warm up to cryptocurrencies, it’s alternative coins that have captured the most attention in recent days.
That fund has attracted about $162 million since its debut in March.
Bitcoin slumped as much as 5.7% to $53,560, the third straight decline.
Meanwhile, many—including famed crypto investor Mike Novogratz—have warned that the rallies could be unsustainable. Novogratz, chief executive officer of Galaxy Digital Holdings, said recently he’d be “very, very worried” were one of his friends to invest in Doge.
“It seems that investors are careening from one hot dot to another, like a pinball game,” said Mike Bailey, director of research at FBB Capital Partners.
“My sense is this speculative wave will suffer the same fate as the GME and other Robinhood ‘flash-in-the-pan’ stocks.
Reddit users’ targeting of Dogecoin, a cryptocurrency named after an internet meme, appears to share little of the logic behind the GameStop buying frenzy, where an army of DIY investors sought punishment for hedge funds “shorting” or betting against the stock.
Will, a finance professional and active member of the WallStreetBets forum who wished to remain anonymous, said Dogecoin’s joke status was behind its appeal to Reddit users.
“Dogecoin was made as an antidote to the very serious Bitcoin. New coins can be created which reduces its value in theory, unlike Bitcoin where supply is fixed, and they cost next to nothing compared with Bitcoin’s high price per coin, so it is not a very serious cryptocurrency.
Robinhood experienced technical difficulties during Dogecoin (DOGE)’s spike to a new all-time high.
The meme-based cryptocurrency recently achieved a new milestone, breaking $0.60 for the first time yesterday. DOGE, currently the fourth-largest cryptocurrency by market cap, has now achieved a valuation exceeding that of Twitter and Ford, at $86.63 billion.
Amid its spike, Robinhood experienced difficulties processing the surge in transaction volume on its platform. This caused many to take to Twitter to critique the crypto trading platform, as the incident was reminiscent of the network-wide freeze experienced by Robinhood during the Gamestop frenzy.
After experiencing a temporary outage from 9:30-11:15 am Eastern Time, the trading platform’s functions were restored.
Dogecoin investors took to Twitter Wednesday to try to push the value of the meme-based cryptocurrency to $1 in value.
Why are Dogecoin investors trying to reach $1 now?
Social media users tweeted their beliefs in Dogecoin using the hashtag #DogeCoinTo1Dollar, which was one of the top trending hashtags Wednesday morning.
The recent push began after Dogecoin saw a more than 30% spike in value. The jump came shortly after Tesla CEO Elon Musk tweeted a meme with the Dogecoin dog — a Shiba Inu dog — on social media.
Another reason for the spike is that Coinbase Pro announced Tuesday that Dogecoin will soon be made available on its assets exchange platform, where trading is allowed.
- Doge will be available for trading on Coinbase Pro — a digital assets exchange website — beginning at 10 a.m.
Sellers may look to capitalize on any weakness that sees Dogecoin drop below $0.19 to target $0.10. However, if the current column of Os were to retrace all the way to $0.19, and dip lower to $0.17, then a Spike Pattern will develop, giving bulls an opportunity for a fast mean reversion trade setup.
On the long side of the market, there is a hypothetical bullish trade opportunity for Dogecoin price.
The entry would be a buy stop order at $0.34, a stop loss at $0.30 and a profit target at $0.50. The entry is based on the break of a triple-top that would develop if a new X-column was pushed to the most recent swing highs.
Robinhood ran into issues processing cryptocurrency trades this morning, during a spike in the price of Dogecoin that sent users flocking to the app. The website DownDetector shows the outage starting around 9:30AM ET and reducing in severity about an hour later.
Robinhood confirmed that it experienced a “partial outage” in crypto trading and said the issues had been resolved as of 11:15AM ET.
The outage was particularly noticeable since it came during a spike (and subsequent dip) in Dogecoin prices. Coins were priced at around $0.40 USD at the beginning of the day.
Around 8AM ET, they spiked past $0.50 USD and reached as high as $0.60 USD near 10AM ET.
Users were quick to voice their frustrations with the app on Twitter, seeing it as a repeat of the situation that happened in January when Robinhood limited trading on buzzy, soaring stocks, including GameStop and AMC.
Dogecoin short liquidations worth $47.83 million.
Bullish calls resurface
Dogecoin’s latest move uphill also prompted observers to predict a $1 valuation in the coming sessions, a level DOGE/USD missed after peaking out at $0.76 on Binance.
For instance, Primordial Hashrate, a crypto-focused newsletter service, cited Dogecoin’s Relative Strength Index (RSI) — a technical indicator that charts an asset’s current and historical strength or weakness — as its signal to bid DOGE/USD toward $1.
Ronnie Moas, founder of Standpoint Research — a Miami-based financial research startup — noted that Dogecoin’s addition on Coinbase Pro, a platform most popular among professional crypto traders, would open DOGE to “million more investors worldwide.”
Dogecoin grew into traders’ conscience primarily after it received backing from Elon Musk.
Dogecoin price shows signs of disappointing bulls who were anticipating an imminent breakout towards $0.50. Instead, sellers were able to take control and push Dogecoin below a triple-bottom, threatening a return to price levels last traded in April 2021.
Dogecoin price finds sellers in temporary control, massive sell-off ahead if buyers fail to support Dogecoin
Dogecoin price has a genuine threat of an imminent flash crash.