$WIF (Dogwifhat) declines by over 30% from local high of $1.97B market cap

Dogwifhat Faces Sell Pressure, Market Cap Declines

Dogwifhat (WIF) has experienced a significant decline in market cap by 31.97%, facing strong sell pressure after its recent recovery. As of the time of writing, WIF's market cap stands at $1.34 billion.

Trend in Meme Coins

WIF's price decline mirrors a similar trend observed in other popular meme coins, including Shiba Inu (SHIB), Pepe (PEPE), and Dogecoin (DOGE). Over the past month, DOGE's price has fallen by 16%, while PEPE and SHIB have declined by 36% and 25%, respectively.

Compared to these peers, Dogwifhat has seen a steeper drop, losing over 53% since July 22nd.

Liquidation Data

According to CoinGlass, WIF long liquidations have surpassed shorts, with over $6.9 million in longs liquidated in the past 10 days, significantly exceeding the $3.12 million in liquidated short positions. This suggests that traders had positive expectations for WIF's price, anticipating its continued rise. However, forced sales due to liquidations intensified downward pressure, leading to a substantial decline.

Head-and-Shoulders Pattern

As of the time of writing, Dogwifhat faces potential for further downside movement due to a classic head-and-shoulders (H&S) pattern forming on the daily chart. This pattern consists of three peaks, with the middle peak higher than the outer peaks. A neckline connects the bottom of these peaks.

WIF broke below the support line on August 5th but quickly recovered. Currently, it is attempting to retest this support level. If it breaks and rebounds from this line, the H&S pattern will be invalidated.

Potential Recovery

Breaking above the support line could indicate a bottoming out of WIF's price, with a retracement towards the previous high. In that scenario, the next targets would be the 50-day exponential moving average (blue line) and the 200-day exponential moving average (orange line).