The Dogecoin price has recoiled sharply as investors raise doughts about Elon Musk’s acquisition of Twitter. After soaring to a multi-week high of $0.1715 on Tuesday, the coin has crashed by 20% and is trading at $0.1381, bringing its total market cap to about $18 billion.
Doubts about buying Elon Musk on Twitter
On Monday, Twitter announced that it had agreed to be acquired by Tesla and SpaceX CEO Elon Musk. The agreed price of the deal was $54 per share, which would value the company at more than $44 billion.
However, there are concerns about whether the deal will go through. For one, the Twitter stock price is trading at $49, which is lower than the acquisition price. The company is currently valued at about $37 billion, which is over $7 billion below its acquisition price.
It is believed Elon Musk will walk out of the deal and pay the $1 billion severance fee. It’s simply because the acquisition of Twitter will have unintended consequences for Tesla and other companies owned by Musk.
For one, Tesla’s biggest market is China, where it also owns a large plant. The company also buys most of its input from China. Now, China is a country known for its crackdown of free speech. Therefore, there is a likelihood that it will work to punish Musk in case of any unfavourable tweets.
Consequently, the price of Dogecoin crashed due to growing fears that Musk is not buying Twitter at all. Most investors believe that if the acquisition closes, it will be a good thing for Dogecoin, as Musk has pledged to add it as a payment option.
Dogecoin price prediction
The daily chart shows that DOGE price has formed a double top pattern at $0.1725. A double top is usually a bearish sign. It has now moved above the 25 and 50 day moving average while the stochastic oscillator has moved above the oversold level. Therefore, the coin is likely to continue falling as the bears target the next key support level at $0.1100. A move above the resistance at $0.15 will invalidate the bearish view. here’s how buy Dogecoin.
