Dogecoin came soaring up to 15% on Monday, which caused the cryptocurrency to negate a downtrend that began on April 5, per a Benzinga report.
The crypto's surge came after reports that claim that Tesla's CEO, Elon Musk is entering a deal to acquire Twitter, Inc. and will soon become the social media giant's CEO.
Many suspected that if Musk acquires Twitter, many are hopeful that Dogecoin will be integrated into the social media platform in some way as the entrepreneur is a keen supporter of the cryptocurrency. They were right.
Musk's Attempt To Take Over Twitter Influences Crypto World
Dogecoin surged up to 15% since the news about Musk's possible acquisition of Twitter, which shows Tesla's CEO's significant influence on the cryptocurrency market.
CryptoPotato reported that like most other digital assets, the first-ever meme coin started the day deep in red, trading at around $0.124, while currently, it is hovering at almost $0.15.
Musk often praises Dogecoin's merits. He argued that the token is better suited for payments than bitcoin at the end of 2021.
When Tesla accepted the meme coin as a payment method nearly a month later, Dogecoin's USD valuation spiked by double digits almost instantly.
In the past few months, Musk and Twitter have been interacting with one another. Musk purchased over 70,000,000 of the company's shares (9.2% of the platform's total stake) several weeks ago and it was also expected that he would join Twitter's Board of Directors.
But shortly after, Tesla's CEO reversed his decision, something that Parag Agrawal, Twitter's CEO, did not explain.
The saga continued as a few days later, Musk made a $43 billion offer to buy the social media company, saying that Twitter has "extraordinary potential," which could be unlocked with his help, as per the CryptoPotato report.
CryptoPotato also reported that the deal will most probably happen and it could become official as early as today — April 25. Twitter's stocks increased by 3% in pre-market trading shortly after the news broke.
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Dogecoin's Surge Predicted
Forbes predicted on mid April that Dogecoin's price could soar if Musk buys twitter. This would also potentially boost bitcoin, ethereum and other cryptocurrencies.
Alex Krüger posted to Twitter: "Dogecoin is now a proxy for Twitter's stock and Elon's acquisition. If the Twitter board says yes, the stock would rise 16%. If they say no, it would dump over 20%."
Benzinga explained in their report that technically, Dogecoin looked set to break higher because its downtrend was taking place beneath a descending trendline. A descending trendline acts as a resistance level and indicates there are more sellers than buyers even though the price continues to fall.
A large reversal may be on the horizon when a stock or crypto breaks up from the trendline.
The stock or crypto must touch the line on at least three occasions in order for a trendline to be considered valid. After that, the more times the trendline is touched, the weaker it becomes.
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