Dogecoin Faces Resistance as Elon Musk Shakes Up U.S. Politics

Dogecoin is struggling to regain momentum after a sharp fall from its peak at the end of 2024. Glassnode's on-chain data shows the Realized Price Distribution UTXO (URPD), Dogecoin faces strong resistance zones at $0.18; $0.21 and $0.36.

Analyst Ali Martinez reported that approximately 13.4 billion DOGE was last moved at $0.18. This is the second largest holding group after the support level of $0.0739. At the level of $0.21, about 10.85 billion DOGE has changed hands, indicating another potential sell zone. The level of $0.36 accounts for 5.73 billion DOGE, representing the third important resistance zone. This concentration indicates that many holders may exit their positions when the price reaches breakeven, putting downward pressure on the price trajectory of DOGE. Technical Outlook: Important Fibonacci Levels Are Playing Out Dogecoin reached a high of $0.486 in November 2024 before entering a prolonged downtrend. Currently, it is trading just above the Fibonacci retracement level of 0.786 at $0.174. A breakout above this level could trigger a move towards $0.22, in line with the 0.618 retracement zone.

The chart also shows that $0.21 and $0.36 remain significant resistance zones. They align with previous support zones and currently act as selling pressure zones due to volume clusters. If DOGE cannot hold above $0.16, it may return to the support zone of $0.09. Currently, the token is still within a consolidation range, with strong resistance above and limited upward momentum. Elon Musk's Political Moves Could Change Market Sentiment Elon Musk recently announced the establishment of the America Party following the poll on July 4th. Nearly two-thirds of the 1.24 million voters supported this idea. Musk criticized the U.S. political system as corrupt and ineffective, describing it as a "one-party system."

This move further deepens the rift between Musk and Donald Trump. He publicly questioned Trump’s "Beautiful Big Bill," which could add an additional 3.3 trillion dollars to the national debt. Musk also criticized Trump's debt reduction initiative based on DOGE. In response, Trump warned that Musk's party could split the Republican vote in 2026, raising concerns among conservatives.