Why Dogwifhat is Leading the Memecoin Market with 112% Gains
Dogwifhat, the largest Solana-based memecoin by market capitalization, is on track to continue its recovery, having begun on September 8. WIF has climbed approximately 112% from its September 6 low of around $1.4, reaching a four-month high of $2.97 on October 16. As of now, WIF is trading at $2.63, up 3% in the past 24 hours and 76% over the last 30 days.
Factors Driving WIF’s Price Momentum
WIF Rises Alongside Other Memecoins
The bullish performance of Dogwifhat on October 18 coincides with similar upward trends in other prominent memecoins, including Dogecoin (DOGE), Shiba Inu (SHIB), and Pepe (PEPE), which have rallied 23%, 9.8%, and 9.2% over the past week, respectively. Among the top-cap memecoins, WIF has shown more substantial gains over the past month, with its 30-day returns reaching around 76%, significantly surpassing DOGE’s 34% and SHIB’s 43%.
WIF has also performed exceptionally well in 2024, boasting year-to-date returns of approximately 1,392%, second only to Turbo (TURBO), a ChatGPT-coded memecoin that has surged by about 4,570%.
Increasing Open Interest and Market Sentiment
The price surge of Dogwifhat over the last 30 days coincides with a significant jump in its open interest (OI). Open interest is a crucial metric used by traders and analysts to gauge market sentiment and predict future price movements. WIF’s total OI across all exchanges increased by 50%, from $322.2 million on October 4 to a five-month high of $480.2 million on October 15. Additional data from CoinGlass shows rising demand for leveraged long positions in WIF in recent days, as indicated by the OI-weighted futures funding rate.
The current 0.0068% eight-hour funding rate translates to a 0.14% cost over seven days, which is significant for traders establishing futures positions. Increasing funding rates typically suggest that futures traders are bullish, anticipating future price increases, potentially indicating a continuation of the uptrend.
Technical Analysis: WIF Eyes $3
From a technical standpoint, WIF’s price action since early September has exhibited a series of higher highs and lower lows, forming an ascending parallel channel on the daily chart. The green engulfing candlestick indicates that bulls are gaining control over the price movement.
The lower boundary of the channel, positioned at $2.50, serves as immediate support for the memecoin. The relative strength index (RSI) is on the rise, with a current position at 59, suggesting that market conditions still favor upward momentum. Consequently, increased buying from current levels could propel WIF towards resistance from the middle boundary of the rising channel at $2.91.
If WIF surpasses this level, its price could challenge the upper boundary of the prevailing chart pattern at $3.42, representing a potential 28% gain from the current price.
Market Risks and Liquidation Levels
However, futures traders remain cautious about a sustained recovery in WIF, with a total of $22.92 million in short positions at risk of liquidation if the price recovers to $3. Additionally, a further 5% decline down to $2.5 could eliminate $3.84 million in long positions.
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