dogwifhat [WIF] has observed a significant 37% surge since Monday, September 23rd, up to the current point in time. Moreover, the meme-based coin has broken out of the seven-week range pattern, with the peak reaching $1.98.
Given that this marks WIF’s initial cycle, potentially paving the way for a prolonged uptrend, one cannot dismiss the possibility of experiencing a 2021 Dogecoin [DOGE]-esque rally. Here’s what stakeholders and swing traders should bear in mind.
Potential Rejection by Fibonacci Retracement Levels
The daily market structure displayed strong bullish tendencies, with the On-Balance Volume (OBV) signaling intense buying pressure. Notably, the indicator’s surge past the highs of August and July hints at a potential breakthrough beyond the $2.9 threshold.
Fibonacci retracement levels were introduced based on the downward momentum observed in the latter part of July. Positioned at $2.5, the 78.6% retracement level, previously serving as support before flipping to resistance, holds significant importance.
A decisive daily close beyond this threshold could potentially act as a turning point for the bullish trend. Although a setback seems improbable, a potential retracement in Bitcoin [BTC] might trigger a pullback in WIF as well.
The Significance of the $2.5 Threshold in the Near Term
Recent data from the liquidation heatmap highlights the $2.45-$2.5 and $1.8-$1.9 regions as crucial near-term resistance and support levels. Noteworthy liquidity is also present at $2.12.
These key zones are anticipated to witness heightened activity before a possible trend reversal occurs. The presence of Fibonacci levels and liquidity around the $2.5 mark designates it as a pivotal resistance level that dogwifhat bulls need to conquer.
Disclaimer: The opinions expressed are not intended as financial, investment, or trading advice but solely represent the author’s viewpoint.