Elon Musk Dogecoin SNL: Time for Caution or Will Price Break $1.00?

The Elon Musk Dogecoin SNL guest appearance on Saturday Night Live (SNL) has Twitter in a frenzy with watch parties being organised in expectation of it triggering further big upside price moves for the meme coin.

This latest development in the DOGE story follows Musk’s regular tweets about the coin, earning him the nickname the ‘Dogefather.’ His backing is a big part of why Dogecoin has turned it from being a joke into one of the leading cryptocurrencies in the world.

The Tesla CEO will co-host the SNL show at 11.30 p.m. EDT. His appearance will put both Elon Musk and Dogecoin in the spotlight. But even though Dogecoin has been gaining massively, up 14,000% this year, Tesla stock has seen last year’s bullish rally reverse, with the shares falling 4.7% year to date.

The next price target for the coin is $1.00, with some traders seeing Dogecoin reaching $5 by year’s end.

Is Elon Musk’s cautious tone a downer for Dogecoin pre SNL?

Unlike most prominent CEOs who tend to stay well away from cryptocurrencies, Elon Musk has taken a leading role in cheering for crypto by highlighting the benefits he thinks they could provide. In February, Musk, in a backhanded endorsement of Bitcoin, stated on Twitter: “…when fiat currency has negative real interest, only a fool wouldn’t look elsewhere. Bitcoin is almost as bs as fiat money. The key word is ‘almost’.”

The main coin that Musk promotes is Dogecoin. When the billionaire tweets about DOGE it often leads to massive price spikes for the crypto. He is also a supporter of Bitcoin (BTC). Tesla’s can now be purchased using Bitcoin and the company now holds the digital currency on its balance sheet. The Tesla treasury announcement was among the contributors to Bitcoin’s bullish rally this year.

Because of the effect of Musk’s tweets on the value of crypto, some developers have created bots that purchase or sell as soon as the Tesla CEO mentions crypto. However, this week, Musk advised people to be cautious when investing in crypto. He attached a video clip on the tweet in which he says “it should be considered speculation at this point. And so, you know, don’t go too far in the crypto speculation …”

Musk’s cautious tone may serve to hold back some buyers, but alternatively it will confirm for some that he is merely setting the scene and will have something to say about Doge in a few hours’ time.

Will Elon Musk effect spark buying frenzy?

Most of the time, whenever Elon Musk tweets about Dogecoin, its value shoots up. It has gained over 800% in the past month alone and surpassed XRP to become the fourth-largest cryptocurrency in terms of market cap. The market capitalisation for Dogecoin now stands at $81 billion. Data on CoinMarketCap shows Dogecoin reached an all-time high of $0.70 on May 8.

DOGE/USD 1 day chart, Binance, 8 May 2021. Courtesy TradingView

Dogecoin’s rally has placed it way ahead of prominent cryptocurrencies such as XRP, Tether, and Litecoin.

However, its parabolic price explosion has created nervousness among pro traders and regulators, who fear retail speculators risk losing a lot of money.

So will the Elon Musk Dogecoin SNL platform spark a buying frenzy? At the time of writing Dogecoin is price at $0.64, pulling back from $0.70 touched at 10pm EST. Maybe the near-term top is already in.

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