Dogecoin (DOGE) pared a portion of its massive daily gains on April 4 as investors speculated on the meaning behind Elon Musk’s latest cryptic stunt.
Elon Musk pumps Dogecoin by over 30%
In what appears to be a late April Fool’s joke, Musk-owned Twitter changed its official blue bird logo to mimic Dogecoin’s symbol — a Shiba Inu dog featured in viral memes. Later, Musk tweeted a meme recognizing the change.
pic.twitter.com/wmN5WxUhfQ
— Elon Musk (@elonmusk) April 3, 2023
Over the years, Musk has historically influenced the Dogecoin market with his cryptic tweets. The billionaire investor calls himself “Dogefather” and has earlier discussed the prospects of adding a DOGE payment option for Twitter subscription services.
His other ventures, Tesla and SpaceX, already accept DOGE for its merchandise products.
Dogecoin rose nearly 33% after Musk’s tweet on April 3, reaching $0.104, its highest level since December 2022. DOGE price has pared a portion of its gains since, dropping to lows of $0.092.
DOGE/USD daily price chart. Source: TradingView
Interestingly, DOGE’s ongoing run-up came after the news of Musk’s lawyers seeking to end a $258 billion lawsuit against him for allegedly pumping Dogecoin prices.
In July 2022, the plaintiff had accused Musk of manipulating DOGE prices using his broad social media presence — including an appearance on Saturday Night Live, which helped Dogecoin price rally “by more than 36,000% in two years” and crash afterward.
What’s next for DOGE price?
From a technical perspective, Dogecoin eyes a short-term pullback after testing a strong selling area (purple) as resistance, as shown below. Also, the DOGE’s daily relative strength index (RSI) has entered its overbought zone, which boosts its correction prospects in the coming days.
DOGE/USD daily price chart. Source: TradingView
As a result, a DOGE pullback scenario could have it drop toward $0.89 as its next downside target in April, down 10% from the current prices. This target level has served as resistance during the January-February uptrend earlier this year.
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