Dogecoin jumps 25% after Musk announces DOGE payment for Tesla merchandise

Dogecoin (Governor) prices surged on January 14 as Elon Musk announced Tesla will start accepting it as payment for the commodity.

After the announcement, DOGE price up nearly 13%, hit a 30-day high of $0.2150. Its upward move was part of a larger intraday rally that had already occurred before Musk’s Dogecoin tweet went viral.

DOGE prices rose more than 25% on Jan. 14, before falling back to $0.1986 on profit-taking.

DOGE/USD hourly price chart. Source: TradingView

better than bitcoin

Tesla’s integration of DOGE payment option on its online shopping portal comes nearly a month after Musk share his wishes Cryptocurrencies are accepted as payment on a test basis.

The central stage of Musk’s love for DOGE is its “Better than Bitcoin” features, mainly as a payment method because it uses less electricity. In an excerpt from Musk’s statement to Time magazine, he explained:

“Fundamentally, Bitcoin is not a good substitute for trading currencies. Even though it’s a silly joke, Dogecoin is better for trading.”

The billionaire entrepreneur further emphasized, Bitcoin has a high cost per transaction Compared to DOGE, its transaction volume is low.As a result, Bitcoin may be doing just fine as a store of value asset. On the other hand, DOGE can continue to encourage people to spend.

What’s next for DOGE?

The latest round of buying in the Dogecoin market weakened as DOGE tested a multi-month resistance trendline for an upside breakout.

In detail, the DOGE price rally was bumped into descending trendline resistance, which has limited its upside attempts since May 2021. On January 14, the trend line was again the tool that propelled DOGE from an intraday high of $0.2150 to $0.1958, as shown in the chart below.

DOGE/USD daily price chart. Source: TradingView

Meanwhile, Dogecoin’s 200-day exponential moving average (200-day EMA; orange wave) also played a key role in limiting its gains on January 14. The confluence of resistance suggests that DOGE price may pull back from its ongoing uptrend in the next session.

related: Dogecoin creator slams Mozilla for suspending cryptocurrency donations

If this happens, the coin will be poised to test its 50-day EMA (Velvet Wave) as support, potentially extending its correction to $0.1367 due to its recent historical support.

DOGE/USD daily price chart. Source: TradingView

Conversely, if the downtrend line resistance and the 200-day SMA are breached, traders may see $0.30 as the next upside target for the Dogecoin market. The area around $0.30 was earlier resistance.

The views and opinions expressed herein are those of the author and do not necessarily reflect the views of Every investment and trading move involves risk and you should do your own research when making a decision.