Meme coins explode as Donald Trump wins Bitcoin election, catalyst or coincidence?

by

As a seasoned trader with over two decades of experience under my belt, I’ve seen my fair share of market trends and fads. However, the recent surge in popularity and value for meme coins like Dogecoin (DOGE), Shiba Inu (SHIB), and Pepe (PEPE) has left me both intrigued and cautiously optimistic.

Enthusiasts of cryptocurrency trade celebrated when it was announced that pro-Bitcoin candidate Donald Trump had been elected President of the United States in 2024. This victory could bring about a significant number of adjustments within the crypto trading industry.

In a significant move, various cryptocurrency exchanges, institutions, and companies supported the Republican candidate by making contributions to political action committees. This event, commonly referred to as “the Bitcoin Election” on social media, sparked a surge in multiple categories of cryptocurrencies, with meme coins experiencing the most notable increase.

In the last 24 hours, several meme tokens such as Dogecoin (DOGE), Shiba Inu (SHIB), Pepe (PEPE), Dogwifhat (WIF), Bonk (BONK), and others saw a nearly double-digit surge. However, meme coins modeled after Donald Trump experienced a correction and didn’t rebound, even with Trump winning the election. Michael Saylor, founder and chairman of MicroStrategy, one of Bitcoin’s biggest public holders, tweeted “We have a Bitcoin President,” indicating the prevailing sentiment among crypto traders.

Table of Contents

Donald Trump wins U.S. Presidential election, dubbed “Bitcoin election”

On Election Night in the U.S., Bitcoin (BTC), the leading cryptocurrency, reached an all-time high of $76,244, coinciding with Donald Trump’s victory in the 2024 Presidential elections. Simultaneously, meme coins such as DOGE, SHIB, PEPE, WIF, and BONK surged, recording almost double-digit growth. Crypto traders favor Donald Trump due to his reputation as the “Bitcoin President,” and following the election results, the overall value of cryptocurrencies increased by approximately 0.5%, according to data from CoinGecko.

Cryptocurrency market capitalization crossed $2.67 trillion, on Friday, November 8. 

The Trump-inspired meme coin experienced a 7% drop on Friday, as reported here. Cryptocurrency investors showed high levels of optimism or “extreme greed” on the fear and greed index, signaling their sentiment from Thursday. This level of enthusiasm often precedes a potential adjustment in the cryptocurrency market. The gauge registered 75, suggesting that traders are feeling quite optimistic at this time.

Meme coins gain, market capitalization climbs 17% overnight

In the current Bitcoin market trend, meme coins are dominating the conversation, delivering the greatest returns for traders during the first and second quarters of 2024. The collective market value of these tokens increased by 17%, surpassing a whopping $75.24 billion as per CoinGecko’s statistics.

On Thursday, several meme coins from the top 10 list sorted by market capitalization experienced a significant surge. These included Dogecoin, Pepe, Bonk, Popcat (POPCAT), Floki (FLOKI), Brett (BRETT) and Neiro (NEIRO). Each of these coins saw gains in the double digits.

In the past 24 hours, the trading volume for meme coins has reached an impressive $15.48 billion, driving significant growth within the cryptocurrency market. Following recent elections, there’s been a surge in activity and trade volume among meme coins, contributing to positive developments across the crypto landscape.

The top three catalysts driving gains are Bitcoin’s new all-time high, rising open interest in meme coins across derivatives exchanges, and positive sentiment among traders. The statistics show that derivatives traders are betting big on meme coins after Trump’s win, likely expecting higher gains in the category of tokens. 

On Thursday, the demand for Dogecoin surged, with its open interest reaching an impressive $1.07 billion according to Coinglass statistics. This increased open interest often indicates greater engagement and significance within the crypto trading community, implying more activity surrounding the token.

The current open interest for Bonk stands at approximately $257.60 million, while that for Pepe is around $362.91 million. Notably, both figures show a significant rise as depicted on the graphs.

Top 3 meme coins to watch

Currently, Dogecoin is being traded at approximately $0.197620. With a potential increase of around 6%, it could challenge the significant psychological barrier at $0.21. For almost half a year, this level has served as a resistance point.

The green bars on the Moving Average Convergence Divergence (MACD) graph for DOGE token suggest that it has a strong upward trend. However, since the Relative Strength Index (RSI) is indicating a sell signal, above 70, traders should be cautious as the token could experience a correction. Currently, DOGE is in an “overbought” state and may undergo a price adjustment if demand doesn’t offset the increased selling activity on various trading platforms.

The crucial point at $0.179800 serves as a strong foundation for Dogecoin (DOGE). A potential adjustment might cause the meme token to revert to this level.

The digital currency Shiba Inu, which ranks as the second most popular meme token, appears ready for potential growth. So far, Shiba Inu has been trading within a specific price range, fluctuating between approximately $0.00002169 and $0.00001548. If trends continue, the price of Shiba Inu could increase by nearly 14%, potentially reaching the upper limit of this range at around $0.00001548.

In simpler terms, the Relative Strength Index (RSI) value is about 58, which is near the middle point, indicating a balance between the token and the market. Meanwhile, the Moving Average Convergence Divergence (MACD) indicator, used for spotting price trend direction, suggests that Shiba Inu (SHIB) has increasing strength in its price movement.

In simpler terms, if Shib closes daily at a price below the middle point (average) of its trading range at 0.00001844 USD, it might challenge the bullish argument and potentially drop to 0.00001550 USD.

As a crypto investor, I’ve noticed that PEPE, the meme coin, has managed to break free from its downtrend since September 27. Since then, it’s been oscillating within a specific range. However, technical indicators are painting a bullish picture for PEPE. The rising green bars on the Moving Average Convergence Divergence (MACD) and the Relative Strength Index (RSI) suggest that the price of PEPE could potentially increase.

PEPE might encounter resistance at $0.00001197, which was its peak from September 29; this signifies a 10% surge for the meme token. If there’s a pullback in PEPE, it could potentially find support at $0.00000880.

Future of meme coins and the Trump effect

Trump’s victory sparked a surge in popularity for Bitcoin and meme coins, which is being referred to as the “Trump effect” on various social media sites. It remains uncertain if the 47th U.S. President will fulfill his pledge of turning America into the leading nation in cryptocurrency, by establishing a crypto advisory council, appointing a new chair for the Securities and Exchange Commission, and creating a national Bitcoin reserve.

Traders closely monitor these cryptocurrencies (DOGE, SHIB, PEPE, BONK, WIF) to see if their recent price increases can be maintained over the immediate future.

Read More

2024-11-08 17:06