Dogwifhat (WIF), a Solana-based mimecoin, has surged 15% in the past 24 hours to hit a high of $1.98 on September 24. The rally comes after the WIF price fell 60% from its all-time high of $4.85 six months ago.
According to data from Cointelegraph Markets Pro and TradingView, WIF rose 37% from its low of $1.44 on September 18 to trade at $1.96 on September 24.
WIF/USD daily chart. Source: TradingView
In comparison, the total market cap of memecoins increased by 0.33% to $2.3 trillion, with most of the largest memecoins by market cap posting gains on September 24, according to data from CoinGecko.
Price performance of the 10 largest meme coins. Source: CoinGecko
Mean reversion or isolated uptrend?
Several cryptocurrency traders expect Dogwifhat to build on its current momentum and begin a sustained recovery towards its all-time high.
“$WIF is slowly rising and we’ve been quietly accumulating since support last month,” altcoin analyst Sjuul wrote in a Sept. 24 post to X.
Meanwhile, Crypto Jobs, a cryptocurrency technical analyst, said that the WIF price is breaking out of the 180-day falling wedge pattern, and the key resistance levels to watch are $1.98 and $2.
The falling wedge $1.75 downtrend line is acting as immediate support for memecoin. The relative strength index rose from 53 to 66 between September 22 and September 23, suggesting that buyers are dominating the market.
WIF/USD daily chart. Source: TradingView
It is worth noting that WIF’s recent rally has turned into support at key levels including the 50-day, 200-day, and 100-day EMAs at $1.70, $1.80, and $1.85 respectively. If buying increases in these buyer congestion zones, WIF is likely to push higher towards the bullish target of the prevailing chart pattern, $2.55.
relevant: Solana TVL is falling, but will SOL price react negatively?
Meanwhile, futures traders are suspicious of a quick rebound, with $10.91 million in short positions at risk if the price recovers to $2.02. A further 10% drop to $1.80 would wipe out $13.63 million in long positions.
WIF Exchange Liquidation Heatmap. Source: Coinglass
Rising outstanding profits support WIF’s uptrend.
The spike in Dogwifhat price on September 24th came after a significant increase in open interest (OI).
Open interest is a key indicator used by traders and analysts to assess market sentiment and anticipate future price movements.
According to CoinGlass data, WIF’s OI increased to $315.95 million on September 24, up about 30.45% from $232.82 million on the previous day, September 23.
WIF pending transactions on all exchanges. Source: Coinglass
Additional data from Coinglass shows that the perpetual futures funding ratio shows that demand for leveraged long positions on WIF has been increasing over the past few days.
WIF Average Perpetual Contract 8-Hour Funding Rate. Source: Coinglass
The current 0.0073% 8-hour rate translates to a cost of 0.05% for a 7-day period, which is not a big deal for a trader building a futures position. Usually, if there is an imbalance due to excessive optimism, the rate can easily exceed 1% per week in the coming days.
This article does not contain any investment advice or recommendations. All investment and trading moves involve risk, and readers should conduct their own research when making decisions.