I analyzed he who musk not be named influence using his tweet sentiment related to price action and trading volume. Many people think he is able to freely manipulate cryptocurrencies via his tweets. Some even use his tweets as a basis for financial decisions. But does he really have this power?

Methods (feel free to skip this part)

• I used a python package, Twint to extract all of his comments since 2018 and sort them by cryptocurrency-related replies or mentions.
• I used Textblob, a python package that uses natural language processing to conduct sentiment analysis.
• Some tweets are links to images, so I did some manual cleaning afterward.
• I then extracted historical prices—calculated price changes in daily, three days, and weekly intervals—and matched them to the dates of the tweet.
• Finally, using polarity and sentiment scores, I conducted an analysis of variance (ANOVA) test.
• The next steps would be correlation metrics if there was a statistical difference among the data sets. If none, the analysis ends.

Results

A look into what are positive and negative tweets

​

https://preview.redd.it/mztpwej3nq371.png?2186&format=png&auto=webp&s=05168ec144dfa57279cddb59c6eedfccb61e04f0

• Since 2018, he tweeted about Bitcoin 42 times and about Doge 72 times.
• The analysis proved that there was no relationship between his tweets and the price actions of the mentioned cryptocurrencies.
• This was also true for the trading volume.
• Lastly, this was true for all timeframes: daily, three days, and weekly. None of the time frames were significant but the three-day frame made the most sense. So, I'll be using it for plotting the data.
• Interactive data visualization; showing you the plots with the tweets as well as other info.

Tweet Polarity and Bitcoin three day returns

​

https://preview.redd.it/ywtz0br4nq371.png?1910&format=png&auto=webp&s=1afbfe0f9e1a1020f944eb6332fa9eae7f0a2b61

• With this, you're looking for linear patterns. In particular, one's that skew in a direction.
• What you get are scattered plots. In other words, a positive tweet doesn't always result in a positive price change and vice versa. Let's take a closer look:

Tweet Sentiment and Bitcoin three day returns

​

https://preview.redd.it/5ebyz5a6nq371.png?1910&format=png&auto=webp&s=068e1a8524eafead2ac45115daa84089c98f863c

• This should give you a clearer picture since the tweets are categorized into positive, neutral, and negative.
• If there was a correlation, what you should be seeing here is that the dots on top (positive) would be on the right and the bottom (negative) on the left.
• What you get are distributed dots regardless of positivity/negativity. Again, a positive tweet doesn't always mean a positive price change and vice versa.

Discussion

Now that we've figured out that there is no relationship between his tweets and cryptocurrency price action, the question is: why have people made these connections in the first place?

Well, you could take a deeper look into his tweets. Two famous tweets in particular: Tesla buying Bitcoin (+19.25% on the day) and Tesla no longer accepting Bitcoin (-12.6% on the day). One way or the other, these were tweeted before bullish and bearish swings, respectively. So human nature suggests that people will make these connections or patterns.

The fact is: Tesla buying and not accepting Bitcoin is news. And news moves people who then move markets. He posts a lot of 'news' related to cryptocurrencies. Sometimes it hits big; other times, it barely makes a dent or doesn't make sense at all.

Hitting a home run a couple of times; doesn't make you a good batter. For example, on March 24, he announced "you can now buy Tesla with Bitcoin," and the market reacted with a -5.8% after three days. He's also said some positive things such as "SpaceX is going to put a literal Dogecoin on the literal moon". How did the market react? Nothing much: -0.5 on the daily and -0.9% after three days.

Tl;dr

He hits the headlines. That's the truth. People like to talk and to post about him. Twitter, Youtube, Facebook, or Reddit; none of it matters. He is an influential person, that's for certain. But the conversation regarding his relationship with crypto should end there. There's really no point in drawing patterns where there are none.

You can speculate as much as you want but they're really just hit or miss. Do his tweets impact price changes? No. Do his tweets increase trading volume because of trading bots? No. Should you base your financial decisions on his tweets? No. Should we move on from myth? Yes. Will people move on from this myth? Unlikely. But the truth doesn't care about how people look at it. Do what you will with this information.

This is my first and, hopefully, last post about him. Peace.

​

Edit: Reposted after being removed due to the limitation algorithms