The largest and most popular meme coin, DOGE, is back in the spotlight after its most significant fan, Elon Musk revealed he would transition from crypto to artificial intelligence (AI). Dogecoin price dropped this week in tandem with the rest of the crypto market amid regulatory pressure and the ‘ghosts’ of the messy implosion of Sam Bankman-Fried’s FTX exchange.
Dissecting Dogecoin Price Short-Term Technical Picture
DOGE started giving back gains accrued in January at the beginning of February when the Federal Reserve rained down on the aggressive bullish party by hiking interest rates by 25 basis points.
At the time, investors believed a 0.25% increase in interest rates was good for risky asset classes. However, Jerome Powell’s deflationary remarks quickly became less impactive as more data like the Consumer Price Index (CPI) the Non-farm payrolls, and the unemployment report indicated inflation would be a dominant issue over the coming months.
As the crypto market bleeds, including DOGE’s 5.4% dip in seven days investors are looking forward to key economic data releases for March, culminating with the much-awaited FOMC meeting toward the end of the month.
That said, investors, especially retail investors are likely going to retreat to the sidelines until they can ascertain where the crypto market and more specifically Dogecoin price is heading.
Note that the loss of support at $0.08 implies chances of overhead pressure surging this weekend are high. Therefore, all eyes are glued on tentative support areas at $0.074 and $0.07, respectively.
Dogecoin price would remain in the good graces of the bulls as long as its leg does not stretch further than $0.07. Otherwise, investors would begin to acclimatize to declines sweeping through lower key levels at $0.06 and $0.05, respectively.
Two points of control are coming up strongly to guide the direction Dogecoin price could take in this first quarter. These are the psychological resistance at $0.10 and the above-mentioned critical support at $0.07.
Declines would become apparent if Dogecoin price slides below $0.07. From here, investors could anticipate a sweep down to $0.06 and worse off to $0.055. On the upside, a break above the coveted seller congestion area at $0.10 could be DOGE’s ultimate catalyst for gains back to $0.0159 – highs reached after Elon Musk acquired Twitter in October 2022.
Investors should be aware of the massive outflow volume from DOGE markets as shown by the Money Flow Index (MFI) indicator on the daily chart. Although this index overlays the chart like the RSI, it considers the flow of volume in and out of the asset’s markets.
A consistent downward slope as illustrated on the chart reinforces the bearish grip on Dogecoin price. Therefore, it could be pointless to expect a big rebound this week, especially not in the upcoming few sessions.
Why Dogecoin Price Support At $0.074 Is Solid
Despite the dilapidated technical outlook, Dogecoin price stability at $0.074 could greatly be attributed to investors’ strong conviction the meme coin will turn things around. The IOMAP model by IntoTheBlock shines a light on roughly 35.45k addresses that purchased 34.23 billion DOGE between $0.0738 and $0.0758.
Investors in that cohort are willing to keep Dogecoin price profitable as the crypto market battles widespread overhead pressure due to increased regulatory oversight of the industry from the United States.
With a little push, Dogecoin price may capitalize on the liquidity between $0.07 and $0.074 to reclaim the position past $0.08 and possibly launch another attack on the seller congestion zone at $0.10.
Elon Musk Jumps Ship From Crypto To AI
Elon Musk, the CEO of Twitter has for a long time proved his genuine interest and love for crypto. Dogecoin was the first project to catch the billionaire’s eye to the extent his tweets impact the price of not only DOGE but other related dog-themed meme coins.
Musk now holds Dogecoin, Bitcoin (BTC), and Ethereum (ETH). For some time, Tesla, the largest manufacturer of electric vehicles, accepted Bitcoin as a payment method however, the largest cryptocurrency was dropped due to its electric energy gobbling tendencies – which are believed to be contributing to global warming.
Fast track to 2023 where AI is making headlines with leading tech giants like Microsoft, Google, and Meta rushing to be at the forefront of the wave, Musk reckons that he “used to be in crypto, but now I got interested in AI.”
The tweet elicited interest across the board, with some like Binance asking “why not both?” Others chimed in saying there is a future where Musk can put together his love Dogecoin and his newly found interest in AI.
Musk has been one of the critics of ChapGPT, an AI-powered search tool from OpenAI. ChatGPT blow up late last year, catching the attention of Microsoft, which is reported to have invested $10 billion in OPenAI.
However, Elon Musk warned of the risk of training an AI to be woke but lie. In other words, he was referring to the tendency to receive false information from ChatGPT. Musk declared his interest in AI a week after he warned investors during a Tesla event – people should be careful with the technology.
But don’t take this the wrong way, what Elon Musk is saying is that people must be careful with the information they give to AI software tools. In fact, the billionaire recently said he would be considering starting an AI company to ethically rival OpenAI.
Dogecoin Alternatives To Buy
If you’re looking for other high-potential crypto projects alongside DOGE, we’ve reviewed the top 15 cryptocurrencies for 2023, as analyzed by the CryptoNews Industry Talk team.
The list is updated weekly with new altcoins and ICO projects.
Disclaimer: The Industry Talk section features insights by crypto industry players and is not a part of the editorial content of Cryptonews.com.