- dogwifhat formed a deathcross on the one-day chart, indicating a continuation of bearish trends.
- Despite this bearish sign, 83% of traders on Binance are long traders, betting on an uptrend.
dog hat [WIF] was among the top performers in the cryptocurrency market in 2024. During the year, the memecoin rose by more than 1,000%. However, the trend weakened in December after the price fell 42% over the month.
At the time of writing, WIF was trading at $1.77, having fallen 4% in 24 hours. The continued decline has led to a “death cross” appearing on the memecoin’s one-day chart.
Analysis of dogwifhat’s death cross
WIF’s “death cross” occurred after the 50-day Exponential Moving Average (EMA) of $2.50 fell below the 200-day EMA of $2.55.
This indicator suggests that dogwifhat could enter a long-term bearish trend that could drive the price down.
Source: TradingView
WIF’s death cross has formed above the current price, indicating that traders may have already priced in the bearish momentum. However, if the memecoin fails to hold the support at $1.72, a decline to the Fibonacci level of 1.618 at $0.31 is likely.
The Relative Strength Index (RSI) shows a sharp increase in sell-side pressure, which is driving the downtrend. The RSI has fallen to 32, near oversold levels, and has formed lower lows, indicating that buying pressure is insufficient to counteract selling pressure.
An oversold RSI usually precedes a short-term price correction to the upside. However, if buyers hesitate, WIF could consolidate at current levels.
The Long/Short ratio shows a bullish bias
Data from Coinglass shows that there are a significantly larger number of long traders than short traders on the Binance exchange. In fact, 83% of traders on the exchange have opened long positions on WIF, which is the highest percentage in almost a month.
Source: Coinglass
Since funding rates have also remained positive, long traders are willing to pay a fee to maintain their positions.
Although traders are optimistic about a trend reversal, many long positions could backfire. If a sudden price drop occurs, it could trigger a wave of liquidations. This in turn would reduce WIF prices.
Can WIF regain its spot as one of the top Solana memecoins?
The drop in the dogwifhat price has caused its market capitalization to drop to $1.8 billion. It is now the fourth largest memecoin on Solana, after outperforming by THUMP [BONK], ai16z [AI16Z]And Pudgy penguins [PENGU)].
Read dogwifhat’s [WIF] Price forecast 2024–2025
For WIF to regain its top spot, it must rally and outperform the three top-ranked Solana memecoins.
This rally will depend on positive market sentiment and belief among traders.