Why are Dogecoin and Shiba Inu prices increasing? Here’s what the experts say
Dogecoin (DOGE) and Shiba Inu (SHIB), nicknamed the meme-coins, jumped more than 150% and 30%, respectively, in the past seven days after Elon Musk, a known supporter of these cryptocurrencies , took the helm as chief executive officer (CEO) of social media company Twitter Inc.
Dogecoin and Shiba Inu Rally
Dogecoin’s gains continued last week on hopes it would get a major boost from Musk’s acquisition of Twitter. “A massive intraday rally was part of a larger uptrend that started on October 25,” said Amanjot Malhotra, Country Head of Bitay, India.
Shiba Inu, the second largest meme token by market cap, also posted a copycat rally. “However, according to a classic Relative Strength Index (RSI) technical indicator, Dogecoin’s ongoing price rally is starting to look overloaded,” Malhotra added.
The RSI, a momentum indicator that tracks price changes to analyze overbought or oversold levels, rose to 93.69 on the daily Dogecoin chart. This is the highest level since April 2021. A month prior, DOGE price hit its all-time high of $0.75.
Malhotra noted that the rally might not last long as it was pushed mainly on perception. “We have to wait a long time to see if these meme pieces will actually see demand from Twitter,” he said.
Besides SHIB, altcoins like AVAX and ATOM also saw price gains. AVAX increased by 4.8%. “Traditional markets are showing early signs of recovery, with central banks signaling easing monetary policies to balance the economic balance. Buying activity in traditional and digital assets is expected to continue if macro factors remain supportive,” he said. said Shivam Thakral, CEO of BuyUcoin, an India-based crypto exchange.
Dogecoin is up 23% in the past 24 hours. It was trading at $0.1483 as of 4:00 p.m. Meanwhile, Shiba Inu was trading at $0.00001299, up 5.90% in the past 24 hours.
Like Bitcoin, Dogecoin operates on the old proof-of-work consensus mechanism and requires participants to solve complex computer equations to earn rewards. Dogecoin’s closest rival is Shiba Inu, but it runs on the ERC-20 framework and is therefore not a cryptocurrency; instead, it is a cryptographic token.