Dogecoin price risks 66% drop to $0.06 as Trump-Musk feud intensifies

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Key takeaways:

• Dogecoin experienced a decline of approximately 7% on June 6 as tensions between President Trump and Elon Musk intensified.
• A bearish flag pattern observed in DOGE/USD charts suggests a potential price decrease of up to 66%.

Dogecoin's (DOGE) price exhibited a bearish trend starting June 5, coinciding with a public disagreement between U.S. President Donald Trump and Elon Musk, a prominent supporter of the cryptocurrency. As of recent reports, DOGE's price has decreased by 7% to $0.17, with bearish patterns indicating potential further declines to $0.06.

Musk-Trump Discord Impacts Dogecoin

Market data indicates Dogecoin trading negatively for the third consecutive session on the weekly chart. The price has fallen by 14% over seven days, extending a three-week slide to 28%, as Elon Musk's public disagreement with President Trump escalated.

The dispute, which started after Musk's departure from a governmental role, intensified when Trump threatened to terminate Musk's government subsidies and contracts. Musk responded by suggesting Trump would have lost the 2024 election without his support.

Musk's influence on Dogecoin's price is notable, often driven by endorsements through social media or Tesla's acceptance of DOGE for certain transactions. For instance, Dogecoin surged more than 25% in 2022 after Tesla began accepting DOGE as payment for select merchandise.

The ongoing conflict has contributed to broader market concerns. Investors are now worried that reduced support from Musk could negatively impact crypto sentiment and Dogecoin's appeal, potentially driving its price down further.

Bear Flag Pattern Targets Below $0.1

DOGE has seemingly confirmed a bear flag pattern on the weekly chart after dropping below the lower boundary of the flag at $0.20.

Dogecoin's price is currently testing the support level at $0.15, aligning with the 100-weekly simple moving average (SMA).

Key support levels to monitor include the 200-day SMA at $0.14 and the April 7 low at $0.13. A significant move below these levels could accelerate a sell-off toward the technical target suggested by the bear flag pattern, potentially reaching $0.06, representing a 66% decline from current levels.

DOGE/USD weekly chart. Source: Cointelegraph/TradingView

The relative strength index (RSI) is below the midline and has decreased from 52 to 43 in the past three weeks, signaling increasing bearish momentum. An RSI value of 43 indicates further potential for downside movement before reaching oversold conditions.

As previously reported, a sharp downturn from the 20-day EMA ($0.20), which aligns with the flag's lower trendline, could increase the risk of a deeper correction to $0.14 or lower.

Disclaimer: This article does not constitute investment advice. Cryptocurrency investments are inherently risky, and readers should conduct thorough research before making any investment decisions.