Dogwifhat (WIF) price has shown mixed signals, with gains of 22.43% in the last three months. However, the coin has fallen by 5.53% in the last week.
Furthermore, the ADX suggests that the current downtrend lacks strength, although the EMA lines are approaching a bearish “death cross” formation. If the downtrend gains momentum, WIF could see further declines.
WIF presents mixed signals
The Ichimoku Cloud on the WIF chart shows that the price is moving close to the cloud, indicating a period of indecision.
When prices are inside the cloud, it usually signals a neutral phase, where neither buyers nor sellers are in control. The alternating colors of the cloud — red and green — reflect this mixed sentiment.
Read more: The Rise and Fall of Memecoins: How Will They Impact the Crypto Market in 2024?
Ichimoku Cloud WIF. Source: TradingView
The extension lines, Senkou Span A and Senkou Span B, indicate future support and resistance. The thin sections of the cloud suggest that the price could break out if momentum picks up. A move above the cloud could confirm an uptrend, while a break below it could indicate a shift to bearishness.
Downward trend is not yet so strong
Additionally, WIF's ADX has risen to 19.07 from around 15 a few days ago, indicating a slight increase in trend strength.
However, an ADX below 20 usually suggests a weak or non-existent trend, meaning that recent changes in WIF's price have not been strong enough to establish a solid direction.
ADX WIF. Fonte: TradingView
ADX, or Average Directional Index, measures the strength of a trend without indicating its direction. Generally, an index above 25 indicates a strong trend, while values below 20 reflect a lack of clear momentum in the trend.
WIF is currently in a downtrend, but with the ADX still below 20, this suggests that the downtrend lacks strong momentum and could be prone to reversals or fluctuations.
Death cross could trigger 14% correction
The WIF EMA lines currently show a bearish setup, with the price positioned below them and the short-term EMAs approaching a “death cross” as they cross below the long-term EMAs. This formation often signals a stronger downtrend, suggesting that selling pressure could increase if it fully forms.
Read more: What is Dogwifhat (WIF) cryptocurrency?
WIF EMA and Support and Resistance lines. Source: TradingView
However, indicators such as the ADX and Ichimoku Cloud reveal that the current downtrend may still be weak. If the momentum reverses, the WIF price could attempt to test the resistance at $2.63 and potentially even $2.80. This could also be driven by the price of SOL, as WIF is one of the most relevant memecoins in the Solana ecosystem.
On the other hand, if the death cross completes and the downtrend gains strength, WIF could decline further to test support at $2.19 and possibly even $1.96, implying a potential 14% drop.
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