dogwifhat [WIF] experienced a significant 25.4% price correction from its peak on Monday, September 30th, to its lowest point on Thursday, October 3rd. This substantial correction also served as a retest of the previous high of $1.98, with the bulls successfully maintaining this level as support.
The buyers of this memecoin have managed to push the price up by 18.9% since then, marking a promising initial step towards recovery. However, the $2.5 resistance level poses a formidable challenge, leaving uncertainty about the bulls’ ability to surpass it.
Significance of the $2.5 Level
An analysis using the Visible Range Volume Profile illustrated that trading activities from June have been primarily concentrated between $1.38 and $2.25. The price surge beyond $2.25 post-correction signified a bullish stance.
The CMF indicator stood at +0.14, persistently remaining above +0.05 despite recent market turbulence, indicating consistent buying pressure. Additionally, the Awesome Oscillator pointed towards ongoing bullish momentum.
Referencing the downturn in July and early August, a series of Fibonacci retracement levels were identified. Notably, the $2.5 level emerged as the 78.6% retracement level, marking a crucial resistance point.
A daily close above $2.5 would indicate a positive trajectory for WIF, hinting at a potential larger rally. This level had previously acted as a strong resistance zone in June and early July, with $2.5 and $2.9 standing out as immediate bullish targets.
Positive Sentiment Surrounding WIF’s Speculative Outlook
The Futures market showcased a robustly bullish sentiment, evident from the increasing Open Interest. Additionally, the rise in spot CVD further reinforced the optimistic bias, underscoring genuine demand supporting the uptrend.
Recent market trends revealed lower liquidations over the past two days compared to October 1st. While trader liquidations have been minimal in recent hours, attention is warranted to observe whether short liquidations escalate notably as WIF nears the $2.5 threshold. This scenario could indicate a liquidity sweep and potentially trigger another price dip thereafter.
Disclaimer: The views expressed in this article do not constitute financial advice; they are solely the author’s perspective.