Meme coins outside the Tron ecosystem are facing an uphill battle, with many struggling to regain bullish momentum amid broader market volatility. Among them, the Dogwifhat (WIF) token is showing signs of recovery after stepping back from a crucial resistance level. But will this retreat further erode WIF’s market cap, or is a rebound on the horizon? Let’s dive into the dynamics at play.
Market Dynamics And WIF’s Declining Trend
WIF’s daily chart paints a grim picture, with the token stuck in a persistent downtrend. This decline is part of a broader correction phase that has plagued WIF for the past five months. The token has formed a falling-wedge pattern, a bearish signal that often precedes a continuation of the downward trend.
Adding to the bearish outlook, there’s a looming death cross on the horizon—a technical pattern where a short-term moving average crosses below a long-term moving average, signaling potential for further declines. Specifically, WIF’s 50-day EMA is on a collision course with its 200-day EMA. Currently trading at $1.74, WIF has seen a 1.59% intraday drop, marking the third consecutive day of losses. The recent rejection at the $2 psychological level has set the stage for what could be an intense pullback.
The token’s attempt to break out of this rut via a double-bottom reversal rally was short-lived. WIF failed to breach the 23.60% Fibonacci retracement level, which aligns with the critical $2 mark. This failure was followed by a morning star pattern, leading to an 11.59% drop since the rejection, raising concerns about a death cross on the daily chart. With the bearish trend gaining momentum, support levels at $1.60, $1.50, and $1.25 are now in focus.
Whale Activity – A Glimmer of Hope?
Despite the bearish indicators, there’s a silver lining. In the last 48 hours, WIF whales have been on a buying spree, suggesting some market participants still see potential in the token. The largest WIF holder recently acquired 800,556 tokens at $1.92 per token. Although the market has since dropped by 8.69%, this whale now holds 28 million WIF tokens, valued at $53.23 million, with a significant profit margin.
Another whale has followed suit, leveraging 1.25 million WIF tokens on MarginFi to borrow $197,000 in USDC, which was then used to purchase 110,000 more WIF tokens. This move signals confidence in WIF’s potential, despite the current bearish trend. The whale’s current holdings stand at 3.3 million WIF tokens, worth $5.95 million.
Also Read: Large Holders Fuel Dogwifhat (WIF’s) Rally – Strategic Accumulation Drives 30% Gain
Can WIF Surpass $2 Again?
Given the high supply pressure near the 23.60% Fibonacci level and the declining EMAs, WIF faces an uphill battle to regain bullish momentum. However, the continued confidence from whales accumulating WIF suggests that a rebound is not entirely off the table.
In the short term, WIF is likely to retest support levels at $1.60 and $1.50. A bounce from these levels could set the stage for a breakout rally, potentially pushing WIF back to the $2 and $2.50 marks. Whether WIF can overcome these obstacles and reclaim higher ground remains to be seen, but for now, the market’s eyes are on the whales and their next moves.
Disclaimer: The information in this article is for general purposes only and does not constitute financial advice. The author’s views are personal and may not reflect the views of Chain Affairs. Before making any investment decisions, you should always conduct your own research. Chain Affairs is not responsible for any financial losses.
About The Author
