- A breakout of the $3.25 resistance could propel WIF to $6.50.
- The supply of stablecoins has shown that market participants have the purchasing power to drive prices up.
Solana-based meme coin Dogwifhat [WIF] Its value has decreased by 16.36% in the past 30 days.
This performance was in contrast to the price trend where WIF was up an impressive 1,650% on a year-to-date (YTD) basis.
Not many cryptocurrencies can boast this this year. However, a strong community has allowed WIF to outperform almost all other popular meme coins this cycle.
At the time of writing, WIF was priced at $3.02. However, before this recent decline, the token was close to $5. However, this attempt was rejected at an all-time high of $4.84.
bulls dominate
Despite the decline, many market participants are confident that the token will soon reach new highs. For some, the cryptocurrency may reach $10. For other companies, 5x $15 is still a reasonable price prediction.
If WIF reaches $10, it means the project’s market capitalization could exceed $10 billion. However, it is important to consider the possibilities before making any conclusions.
First indicator AMBCrypto considered was its funding rate. Positive funding means that the asset’s PERP price is trading at a premium compared to the index value.
In this case, most bets will be on the bullish side. On the other hand, negative funding means that the PERP price of the cryptocurrency is discounted from the spot price.
This also points to broader bearish sentiment in derivatives markets.
At the time of writing, WIF’s funding rate is 0.008%, lower than it was 7 days ago. However, one thing we have observed is that the price of WIF has increased within the past hour.
Source: Santiment
A good inference for this move is that the majority of the spot volume was buy orders. Therefore, WIF prices may skyrocket.
WIF needs to break above $3.25
If this bullish prediction is verified, WIF could initially head toward $3.65. Regarding long-term goals, AMBCrypto analyzed the token from a technical perspective.
On the 4-hour chart, the supertrend flashed a buy signal (green) at $3. However, there was a sell wall (red) at $3.25. In the past, WIF has attempted to overcome this resistance;
However, the bears rejected this move and the price returned to the brink of falling to $2.76. However, the Money Flow Index (MFI) showed that WIF may not be that low.
This is because the MFI reading was close to 60.00, indicating a significant influx of liquidity into the WIF side of the crypto market.
If this number continues to rise, the bulls could successfully break out of the resistance at $3.25. However, the Relative Strength Index (RSI) fell below the midpoint.
However, the reading showed signs of a possible rally above 50.00 to confirm the bullish momentum. In this case, WIF could move towards $6.50.
However, in a very bullish situation, WIF price could reach $10 in the long run.
Source: TradingView
For some, this could happen by the end of 2024. However, others believe that meme coin prices may not reach double digits this year.
Open interest has decreased, but this is not the end
Furthermore, WIF’s open interest (OI) was $251.38 million at the time of writing. OI increases or decreases based on net positioning. An increase in the indicator means that the liquidity allocated to the contract has increased.
In this situation, the buyer is aggressive. Conversely, when OI decreases, sellers become more aggressive. According to Santiment data, WIF’s OI was almost twice as low compared to the March value.
WIF price may recover if traders decide to open more positions. However, it will require a large amount of capital to bring the token closer to its previous highs.
However, AMBCrypto observed that it may not be difficult to achieve. This is due to his supply of stablecoins worth over $5 million held by WIF Whale.
Source: Santiment
At the time of writing, this metric had begun to rise; show This means that WIF’s large investors had enough ammunition to push up the price.
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If the stablecoin is deployed for token purchases, significant price increases could occur.
However, it may not be possible for WIF to repeat the 883% increase in 90 days. Nevertheless, it is possible for the token to rise to $10. AMBCrypto cannot guarantee when that will happen.
