Dogwifhat’s [WIF] performance in the cryptocurrency market during 2024 was notable, showcasing a remarkable surge of over 1,000%. However, this upward trend faced a setback in December when the price experienced a significant 42% decline.
Presently, WIF is being traded at $1.77, marking a 4% decrease within a 24-hour period. The ongoing decline has triggered the emergence of a “death cross” on Dogwifhat’s daily chart.
Understanding the Impact of Dogwifhat’s Death Cross
The “death cross” for WIF manifested after the 50-day Exponential Moving Average (EMA) dropped to $2.50, slipping below the 200-day EMA at $2.55.
This signal intimates a potential entrance into a prolonged bearish phase for Dogwifhat, potentially exerting downward pressure on its price.
The death cross formation occurred above the prevailing price, implying that traders might have already factored in the bearish trend. However, should the memecoin fail to uphold its support at $1.72, there is a high likelihood of a descent towards the 1.618 Fibonacci level at $0.31.
The Relative Strength Index (RSI) demonstrates an escalation in selling pressure, steering the downward trajectory. With RSI dipping to 32, approaching oversold thresholds and endorsing continual lower lows, it implies that the buying impetus is insufficient to counterbalance the selling force.
An oversold RSI typically heralds a brief corrective rebound in prices. Nevertheless, if buyers remain cautious, WIF may consolidate within its current range.
Long/Short Ratio Signals Favorable Outlook
Data analysis from Coinglass unveils a predominant presence of long traders over shorts on the Binance exchange. Notably, a striking 83% of traders on the platform have initiated long positions on WIF, registering the highest proportion in nearly a month.
Despite the positive funding rates, illustrating traders’ willingness to pay fees for holding their positions, an overabundance of long trades could turn precarious. A sudden price nosedive might trigger mass liquidations, subsequently pushing WIF prices downwards.
Can WIF Reclaim Prominence as a Premier Solana Memecoin?
The decline in Dogwifhat’s price has led to a slump in its market capitalization, dwindling to $1.8 billion. Currently, it stands as the fourth-largest memecoin on Solana, trailing behind BONK [BONK], ai16z [AI16Z], and Pudgy Penguins [PENGU)].
For WIF to recapture its leading status, it must stage a rally that outshines the top three Solana memecoins. This resurgence hinges on positive market sentiments and unwavering confidence among traders.