NOIDA (CoinChapter.com)— Historically, DOGE prices have often shared the fate of the stocks of Elon Musk’s more traditional businesses, namely Tesla. Tesla’s (NASDAQ: TSLA) price has had a terrible 2024, with shares of the electric vehicle giant dropping 34% YTD to reach a daily low near $165 on March 18. While that’s bad, TSLA’s price action has Dogecoin proponents worried about a crash.
Elon Musk has been a vocal supporter of cryptocurrencies and has taken a particular liking to Dogecoin, the first memecoin. Many times, it has been a statement from the Tesla CEO that has triggered DOGE prices to go into a bull run.
The Dogecoin Tesla Connection
Between March 2021 and March 2024, Tesla prices have several instances of downtrend. Choosing the ones with a weekly loss of more than $30 gives us 8 instances of TSLA price crash.
Of the 8 instances, Dogecoin price has accompanied TSLA during a plunge, or at least pared gains in the week five times. This gives the Tesla Dogecoin suicide pact a success rate of 62.5%.
For instance, in the week beginning Jan. 3, 2022, the price of TSLA dropped by nearly 3%. In the same week, the price of Dogecoin dropped a whopping 14%.
Again, in the last week of April 2022, TSLA prices dropped 13.3% weekly. Though the Dogecoin price ended the week with 0.66% gains, the token was trading near $0.171 before it closed the week around $0.13.
The correlation between TSLA and Dogecoin continues to be strong in 2024 too, with DOGE price dropping 21% from its weekly high of $0.19 last week, in tandem with TSLA closing the week with losses of 6.7%.
Now, Goldman Sachs analysts have reduced their estimates for TSLA price to $190 following the stock’s dismal 2024 run.
The Mark Delaney-led team lowered their Tesla revenue forecasts due to production challenges and market dynamics, including decreased US and European app downloads and reduced exports from Tesla’s China factory.
With the bearish headwinds coming its way, it seems likely that Tesla stock price could fall, and history suggests that Dogecoin price would likely follow like a loyal dog.
DOGE Bulls Holding On To $0.14
Meanwhile, DOGE price’s recent crash forced the memecoin to invalidate a bullish technical pattern, riding on Elon Musk’s comments. However, since March 14, DOGE prices have dropped nearly 28% to reach a daily low near $0.14 on March 18.
Bulls are working hard to keep the token above the $0.14. DOGE price moved above $0.14 for the first time since Nov. 2022 in March 2024. Hence, the price level serves as somewhat of a psychological support for the Dogecoin token.
If the downtrend continues, DOGE price might drop to the 0.382 FIB support near $0.135. Breaching the immediate support might force Dogecoin price to test the support near $0.116 before recovering.
However, if it turns out to be one of those times when Dogecoin takes a break from following Tesla price action around, the token could start a rally. However, DOGE price would need to break above $0.16 resistance to infuse confidence into the rally and attract more buyers.
Flipping the immediate resistance might help the token rally to the 0.786 FIB resistance near $0.18.
The relative strength index for DOGE remained neutral, with a reading of 49.76 on the daily chart.
