Dogecoin (DOGE) Price Drops as Elon Musk Rejects Speculation About U.S. Government Adoption

The price of Dogecoin (DOGE) has dropped more than 5% after Elon Musk publicly denied that the U.S. government’s newly proposed “Department of Government Efficiency” (D.O.G.E.) has any relation to the Dogecoin cryptocurrency.

Musk Clarifies That “D.O.G.E. Is Not Dogecoin”

Speculation had been brewing in the Dogecoin community after Musk revealed that a new government agency he is leading would be called the Department of Government Efficiency. This has been abbreviated to D.O.G.E. The community began to speculate that the agency might involve Dogecoin in some way, given Musk’s well-known support for the cryptocurrency.

However, During a recent Q&A session, Musk made it clear that there is no link between the D.O.G.E. agency and Dogecoin. He explained that the original name for the agency was going to be the “Government Efficiency Commission”. However, he later changed it to D.O.G.E. because the first option sounded too dull.

Musk emphasized that the agency’s purpose is to improve government operations by making them 15% more efficient. He maintained that it has nothing to do with Dogecoin or any other cryptocurrency. He added, “The names are similar, but they are doing two different things”. This ended hopes of a Dogecoin-related government initiative.

DOGE Down Over 5% With Bearish Signals Confirm Weakness

Following Musk’s comments, Dogecoin experienced a sharp sell-off. The price dropped from approximately $0.20480 to as low as $0.16329. This was a loss of more than 20% within a single week. The sell-off appears to be fueled by the fading speculation around any official association with the U.S. government’s new agency.

Musk’s earlier statements had often triggered Dogecoin rallies. However, this time, he called memecoins “casino-like.” This may have amplified selling pressure. Although Musk acknowledged that Dogecoin has evolved beyond its meme status, he also cautioned against investing life savings into such assets.

Currently, the Dogecoin price chart has formed a descending triangle pattern, a bearish formation that often signals an upcoming breakdown.

The price has been repeatedly making lower highs while finding temporary support around the $0.16 level. However, this support is under threat, and a break below it could push the price even lower.

RSI Signals Weak Momentum But Not Oversold Yet

The Relative Strength Index (RSI), a tool used to measure buying and selling momentum, is currently at 38.63, which is below the neutral 50 level. This reading shows that bearish momentum is stronger at the moment, although the RSI is not yet in the deeply oversold region below 30. This means there could still be room for further downside before buyers potentially step in.

Historically, Dogecoin has often seen rebounds when the RSI approaches or dips below 30, but for now, the market remains weak without signs of a strong reversal.