A top trader has warned about a popular Solana (SOL)-based Dogecoin (DOGE) rival, saying the memecoin has more downside potential.
In a video posted to the social media platform X, the pseudonymous analyst known as Bluntz tells Its 263,200 followers indicate that technical statistics indicate that the meme token dogwifhat (WIF) could face more corrective action in the next three to four weeks.
According to the analyst, WIF witnessed a 109-day uptrend earlier this year, leading him to expect a similar number of bearish days for the memecoin.
“We are [85] days after the pullback… In terms of time, a 1:1 extension… taking us to July.”
As for his downside price target for WIF, the analyst says he will be interested in loading up on WIF as traders capitulate as the memecoin drops in price to around $1.
“So what I expect will happen is that we will have to continue to taper. I think the 0.78 [Fibonacci retracement level] will be bugged… Ultimately, I think this would be an absolutely great long-term entry on WIF.
Bluntz practices Elliott Wave theory, a technical analysis approach that attempts to predict future price action by following the psychology of the crowd that often manifests itself in waves. According to the theory, a bullish asset will often witness a five-wave upward move followed by a three-wave ABC correction period.
Looking at the trader’s chart, he seems to suggest that WIF has already staged a five-wave rally and is now at the tail end of an ABC correction.
At the time of writing, WIF is worth $1.85.
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Generated image: Midjourney