When contrasted with the dominant alternative cryptocurrencies in the market, memecoins have experienced moderate gains over the past month, with Dogecoin [DOGE] leading the charge with an increase of 130%.
Nevertheless, dogwifhat [WIF] has shown weaker performance, especially when compared to its counterparts built on the Solana platform, some of which have witnessed substantial gains in the four digits.
Despite these challenges, it may be premature to dismiss WIF as a major underachiever. Presently, there is a competitive struggle between high-cap and mid-cap tokens to attract investment away from Bitcoin.
As the fourth-largest high-cap memecoin, WIF is potentially on the brink of a significant breakthrough following a two-week consolidation, with the target now set at $4.
If this level is successfully breached, fear of missing out (FOMO) could kick in, potentially propelling WIF to a new record high – but only if investors resist the temptation of mid-cap tokens.
Securing Support from Major Players is Vital for WIF
In mid-November, WIF experienced a surge of over 4% in a single day, marked by a notable long green candlestick, nearing its peak during the bullish run in March at $4.85.
This level appeared to pose strong resistance. A breakthrough could pave the way for WIF to achieve a new all-time high, possibly exceeding $5 by the end of Q4.
The price chart also exhibited signs of optimism as WIF has been consolidating within the $3–$4 range, offering hope to investors anticipating a breakout. Particularly with the Relative Strength Index (RSI) stabilizing in neutral territory – indicating the potential for an upward movement.
However, there is still a looming possibility of a correction, with major players seemingly entering a phase of distribution, either capitalizing on profits from previous dips or lacking conviction in a potential recovery.
Their reluctance to push WIF past $4 could raise apprehensions among investors, emphasizing the need to closely monitor their actions.
The Hurdle Presented by Low and Mid-Cap Coins
Analyzing the performance of tokens in the past week is crucial to understand investor sentiment, setting the tone for December and signaling the conclusion of the Trump-era hype.
While this shift doesn’t necessarily indicate a bearish outlook for WIF, it does underscore a change in investor preference. Many now lean towards the stability offered by these lesser-known tokens, which are less susceptible to drastic price fluctuations compared to memecoins.
Despite this transition, there remains a potential for WIF to surpass $4, especially with its market capitalization surging by more than 9% to $3.62 billion. However, it still retains its speculative nature.
Given the current market dynamics, where major players are breaking even, the chances of WIF experiencing a resurgence appear slim. This is particularly true as the coin heavily relies on these players to establish a stable foundation.
Unless there is a reversal in this trend – where large holders view the current price range as a buying opportunity and increase investments in speculative assets – WIF is likely to face difficulties breaking the $4 mark and embarking on an exponential journey towards a new all-time high.