The Dogecoin price held steady on Tuesday as the momentum of the so-called meme coins remained. DOGE rose to a high of $0.2487, which was the highest level since September 17. The meme coin is up by more than 22% from its lowest level in September, bringing its total market capitalization to more than $31 billion.
Why did DOGE soar?
There are two main reasons the Dogecoin price has rallied in the past 24 hours. First, the price soared as investors reflected on a tweet in which Elon Musk referenced his dog, Floki. This tweet was viewed as being bullish for Shiba Inu, the Dogecoin-killer whose price rocketed by more than 50%.
In the past, tweets by Elon Musk have had a positive impact on the price of Dogecoin and other meme coins. As the richest man, who is worth more than $200 billion, he commands a lot of following and many people look up to him. He has more than 60 million followers on Twitter.
Dogecoin and Shiba Inu were trending on Twitter on Monday as enthusiasts discussed his tweets. This, in turn, led to more demand for the coin.
Second, the Dogecoin price rose as other cryptocurrency prices rebounded. Bitcoin has crossed the important resistance of $50,000 while the total market capitalization of all cryptocurrencies tracked by CoinMarketCap jumped to more than $2.13 trillion. Therefore, there is a likelihood that Bitcoin will keep rising in the coming days.
The Bitcoin price action is notable for Dogecoin and other cryptocurrency prices because of the close correlation that exists among cryptocurrencies.
Still, the Dogecoin price faces a major risk ahead. There is a high likelihood that the American government will default on its international obligations if the Senate will not pass the debt ceiling payments. Such a move will have negative consequences for all assets, including Dogecoin and Shiba Inu.
Dogecoin price prediction
The daily chart shows that the Dogecoin price has been in a tight range in the past few weeks. The price is still about 65% below its all-time high. It is also slightly above the important support at $0.1596, which was the lowest level in June and July.
The price is also along the 25-day and 50-day moving averages while the Relative Strength Index (RSI) has moved to 53. Therefore, at this stage, the outlook of the DOGE price is neutral with a bullish bias.A bullish breakout will likely push the price to the important resistance level at $0.3531, which was the highest level on August 21. This price is about 40% above the current level.
