Amidst a mid-week market slump, meme coins, particularly Dogwifhat (WIF), face increased supply pressures, leading to significant price drops.
Despite attempts, WIF failed to break past the $3.35 resistance level, resulting in a 10% decrease in market value and a loss of the $3 support level.
Technical indicators show bearish trends with a possible continuation of the downtrend, although a reversal from the broken resistance trendline could signal a recovery.
An increase in supply has particularly hard-hit meme coins during the mid-week cryptocurrency market downturn, affecting their price stability and market performance. Dogwifhat, a relatively new and trending meme coin, has seen a drastic reversal in its price, which threatens to disrupt the ongoing bullish trend.
Current market conditions and price movements
Initially, Dogwifhat struggled to overcome a significant supply resistance at $3.35, but has since experienced a 10% decline in market value. This decline saw the WIF price fall below the crucial $3 mark, moving towards the next support level. The 18% drop in trading volume indicates a bullish exhaustion, potentially leading to further supply entering the market.
As a result of the price’s decline, it has retested a previously broken resistance trendline within a triangle pattern, a development that sideline traders are closely monitoring in anticipation of a potential rebound to continue the uptrend.
Potential scenarios for WIF’s price action
Looking ahead, the prospects for a Dogwifhat comeback appear challenging. While there is potential for a post-retest reversal from the broken resistance trendline, the recent intraday decline of 4% indicates that the downtrend may continue.
Should a reversal occur, WIF could aim for the $5 mark this month. However, if the price drops below $2.75, it risks testing the psychological barrier at $2, adding further stress to an already bearish outlook.
As the market navigates through these volatile conditions, investors and traders will need to closely monitor further developments in market sentiment and technical indicators to gauge the potential for recovery or continued declines in the Dogwifhat market.