- WIF briefly crossed the $4 price barrier.
- The Chaikin money flow indicates the possibility of a reversal.
Solana based meme coin dogwifhat [WIF] briefly traded above the $4 price on March 29, registering a new all-time high CoinMarketCaps facts. Valued at $3.68 per WIF at the time of writing, the memecoin has since witnessed a 7% price correction.
Despite the decline, WIF is the crypto asset with the most gains in the past 24 hours. The double-digit price growth recorded during that period has pushed its market capitalization above $4 billion, making it the third-largest meme asset after Dogecoin. [DOGE] and Shiba Inu [SHIB].
WIF on a 1-day chart
A review of WIF’s performance on a daily chart revealed an increase in demand for the meme coin. At the time of writing, the key momentum indicators were above their respective neutral lines.
For example, WIF’s Relative Strength Index (RSI) was 67.31, while the Money Flow Index (MFI) was 59.02. These values showed that WIF’s spot market participants preferred to accumulate the memecoin rather than sell it for a profit.
Measurements of WIF’s Moving Average Convergence Divergence (MACD) showed that the MACD line crossed above the signal line on March 27, initiating the current bull cycle.
This intersection is considered bullish because it indicates that the shorter-term moving average has moved higher than the longer-term moving average, providing an opportunity to buy at a profit.
Source: WIF/USDT on TradingView
The memecoin derivatives market saw trading volume increase by 37% in the past 24 hours, reaching a total of $2.4 billion. Similarly, open interest has increased by 27% during the same period, according to Mint glass’ facts.
When the open interest in the derivatives market of an asset increases, the number of outstanding contracts has increased. This indicates an increase in market participation.
The high open interest, combined with positive financing rates that lag WIF, showed that investors have continued to open their bets in favor of a continued price rally.
Realistic or not, here is the market cap of WIF in terms of BTC
A slight retreat on the horizon?
Despite the 360% increase in the price of WIF in the past month, the Chaikin Money Flow (CMF) has been on a downward trend since March 16. This has led to a bearish divergence, which often precedes any price correction.
This indicator tracks how money flows in and out of a crypto asset. The disparity in the price movement of an asset and the CMF implies that price growth is driven by a small group of buyers. It could also mean that selling pressure could increase despite the price increase.
Source: WIF/USDT on TradingView