Dogwifhat (WIF), the once booming memecoin featuring a Shiba Inu wearing a stylish knit hat, is hitting the sizzling dog water. After a meteoric rise earlier this year, WIF is busy downward spiral, trapped in a descending channel since overdue May. Analysts are watching closely as the dog cryptocurrency approaches a critical support level and its future depends on a tug-of-war between bullish and bearish forces.

Going down the price ladder: a sign of weakness?

Technical analysis paints a disturbing picture for WIF. A descending channel pattern, characterized by lower highs and lower lows, indicates continued selling pressure. The price has dropped a staggering 30% since overdue May and is currently hovering around the key $2.44 level. In the last week, WIF lost 15% of its value, according to Coingecko data.

This level is a turning point for WIF. If bulls – hopeful investors hoping for higher prices – fail to defend this support line, the price could continue to fall, potentially reaching a modern low of $1.93.

A technical twist

Adding fuel to the bearish fire is the Aroon Down indicator, a technical tool that assesses the strength of the downtrend. The Aroon Down Line WIF is at 100%, which indicates a forceful downward trend, with the last low occurring not too long ago. This suggests that selling pressure is outweighing any potential buying activity among WIF holders.

Will the Bulls be up to the challenge?

There remains a ray of hope for WIF fans. If the bulls manage to maintain the current support level, a price rebound towards the resistance line at $2.70 is possible. This would be a short-lived respite, but it would give memecoin a chance to regroup and potentially break out of a degenerating channel.

However, a break from support would be a devastating blow, potentially leading to a domino effect where investors lose confidence and flee the market, throwing the WIF into chaos.

WIF price forecast

Meanwhile, Dogwifhat’s current technical analysis shows that: bearish moods, despite bullish price forecasts of a 225% price raise to $7.87 by July 15, 2024. The Fear and Greed Index indicates a high greed score of 74, suggesting potential overvaluation. Over the last 30 days, Dogwifhat stock has seen 30% green days with a price volatility of 11.82%, reflecting significant price fluctuations.

High volatility and the current greedy mood indicate potential risks, despite the hopeful outlook. Therefore, it may not be the best time to buy Dogwifhat until market conditions stabilize or additional positive indicators emerge.

Featured image from Reductress, chart from TradingView