Fun

Why is Solana's Dogwifhat (WIF) memecoin crashing?

News Feed - 2024-08-18 01:08:17

Yashu Gola7 hours agoWhy is Solana"s Dogwifhat (WIF) memecoin crashing?WIF price risks declining by another 48% due to the formation of a classic bearish reversal setup.1636 Total views29 Total sharesListen to article 0:00Altcoin WatchOwn this piece of crypto historyCollect this article as NFTCOINTELEGRAPH IN YOUR SOCIAL FEEDFollow ourSubscribe onDogwifhat (WIF), the fourth-largest memecoin by market capitalization, is on the brink of erasing the recovery it achieved after the Aug. 5 crypto market crash. WIF has dropped approximately 30% from its Aug. 9 local top of around $1.95, bringing its price down to $1.36 as of Aug. 17.WIF/USDT daily price chart. Source: TradingViewWIF crashes alongside other memecoins 


WIF’s price declines accompany similar downside moves across other top memecoins, namely Dogecoin (DOGE), Shiba Inu (SHIB), and Pepe (PEPE). For instance, DOGE, the largest memecoin by market capitalization, has dipped by approximately 10% in the last nine days.Top memecoin tokens daily and weekly performance. Source: Messari


Among the leading memecoins, WIF has experienced more significant losses over weekly and monthly timeframes. For instance, WIF’s 30-day returns are around -42%, far exceeding DOGE (-15%) and SHIB (-23.5%).Top memecoins year-to-date returns. Source: Messari


WIF had an exceptional year-to-date performance, with returns reaching approximately 708%, second only to Popcat (POPCAT), another Solana-based token that surged by around 4,570%. Such substantial gains likely attracted profit-taking from early investors, leading to increased selling pressure.Long liquidations outnumber shorts


Dogwifhat"s 30% correction from its Aug. 9 local top coincides with a higher number of long liquidations in the WIF futures market relative to short liquidations.


Over the past nine days, there have been cumulative long liquidations of $6.932 million versus $3.16 million in short liquidations, according to Coinglass data.WIF total liquidation chart. Source: Coinglass


It shows that many traders were overly bullish on WIF, possibly expecting the price to continue rising after the Aug. 9 peak. They opened leveraged long positions in the futures market, betting on further price increases.


As the price of WIF began to decline, it triggered margin calls for these over-leveraged long positions. If traders cannot meet these margin calls by adding more collateral, the exchange automatically liquidates their positions to cover the losses.


This forced selling amplifies the downward pressure on the price, contributing to the 30% correction.Is Dogwifhat price bottoming out?


WIF’s downside risks remain intact as it forms what appears to be a classic head-and-shoulders (H&S) pattern. 


An H&S pattern is characterized by forming three consecutive peaks — the middle peak called the head being higher than the other two called shoulders — atop a common support level called the neckline.


Related: Memecoin ‘retail mania’ could go the way of ICOs and NFTs, say execs


As a rule, an H&S pattern resolves when the price breaks below the neckline while accompanying a rising trading volume. It then falls by as much as the maximum distance between the head’s top and neckline.WIF/USDT daily price chart. Source: TradingView


As of Aug. 17, WIF attempted to break below its H&S neckline level of around $1.46. Should it be successful, then its price may fall toward the downside target of around $0.725 by September, down approximately 48% from the current price levels. 


Conversely, reclaiming the neckline as support, followed by a close above WIF’s accumulation area — the $1.48-1.69 range highlighted via the red bar — may invalidate the H&S setup altogether. Should it happen, WIF’s immediate upside targets are around its 50-day (the red wave) and 200-day (the blue wave) exponential moving averages. 


This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.# Dogecoin# Altcoin# Analysis# Markets# Tech Analysis# Market Analysis# Solana# Shiba Inu# Memecoin# PepeAdd reaction

News Feed

POPCAT Nears Breakout Towards New ATH, But Analysts Warn Of Possible Correction
Este artículo también está disponible en español. Multiple market watchers suggest that memecoin sensation Popcat (POPCAT) is about to rally towards a new all-time high (
Mining Ban Sparks Negative Reactions From Iran’s Crypto Community
Mining Ban Sparks Negative Reactions From Iran’s Crypto Community The recently reintroduced seasonal ban on cryptocurrency mining has provoked backlash from the local crypto comm
PBOC Official: China’s Digital Yuan Won’t Be a Speculative Currency Like Bitcoin
PBOC Official: China’s Digital Yuan Won’t Be a Speculative Currency Like Bitcoin According to recent statements by People’s Bank of China (PBOC) official Mu Changchun,
India’s Central Bank Reveals 50,000 Users and 5,000 Merchants Now Using Digital Rupee
India"s Central Bank Reveals 50,000 Users and 5,000 Merchants Now Using Digital Rupee India’s central bank, the Reserve Bank of India (RBI), has revealed that 50,000 users an
Public miners raised $2.2B as cash flow crunch intensifies post-halving
Ana Paula Pereira2 hours agoPublic miners raised $2.2B as cash flow crunch intensifies post-halvingA total of nine out of 13 US-listed Bitcoin mining companies raised capital through stock offers in the second quarter of
Report: Blockchain.com Cuts Staff by 25%, Executive Salaries Reduced
Report: Blockchain.com Cuts Staff by 25%, Executive Salaries Reduced According to a recent report, Blockchain.com has laid off a quarter of the company’s staff and it has cl
Technical Analysis: Gala Jumps 37% Higher, as Crypto Bulls Return
Technical Analysis: Gala Jumps 37% Higher, as Crypto Bulls Return During the weekend, when bitcoin rose to a two-week high, it was Gala that stole the show after climbing 37%. Bull
Vitalik Buterin introduces Circle STARKs for blockchain efficiency
Josh O"Sullivan10 hours agoVitalik Buterin introduces Circle STARKs for blockchain efficiencyButerin reveals Circle STARKs, a breakthrough protocol enhancing blockchain security and efficiency through small-field cryptog
Tom Blackstone9 hours agoFarmville co-creator-led company raises $33M to create Web3 gamesProof of Play raised $33 million to create fully on-chain games that “quickly immerse players in fun gameplay.“1504 Total view
Join the Plena Smart Wallet Referral Program and Win Big with $1,000,000 in PLENA Tokens
Join the Plena Smart Wallet Referral Program and Win Big with $1,000,000 in PLENA Tokens press release PRESS RELEASE.Plena Smart Wallet, which is one of the first self-custodial wal
Strategy (MSTR) Crashes 55%—Is A $44 Billion Bitcoin Liquidation Possible?
Este artículo también está disponible en español. Shares of Strategy (NASDAQ: MSTR) have dropped by over 55% from the November 24 high at $543 to around $250. With the so
Amaka Nwaokocha14 hours agoAI tool revolutionizes brain tumor treatment by guiding surgeons: StudyAlthough the tool’s accuracy may not match current genetic tests, it can swiftly predict a tumor’s profile.3383 Total