The Solana-based meme cryptocurrency, dogwifhat (WIF), has experienced a 30% increase over the last week. However, this rise has brought about heightened market volatility, posing a risk to the token’s potential for further growth.
This analysis explores what holders of WIF can anticipate as the token faces the possibility of significant price movement in either direction.
Dogwifhat Experiences Increase in Market Volatility
The double-digit price climb of dogwifhat has been accompanied by a marked rise in market volatility, which is evident from the expanding range of its Bollinger Bands indicator.
In recent days, the distance between the upper and lower bands of this indicator has progressively widened. Generally, wider bands suggest that prices are diverging from the average, indicating heightened volatility.
Read more: How to Purchase Dogwifhat (WIF) and Additional Insights
The increase in WIF’s Average True Range (ATR), which quantifies its volatility over a given time frame, supports this observation. This indicator has been on an upward trajectory since September 17, currently standing at 0.18.
An increase in an asset’s ATR typically indicates a rise in market volatility, suggesting that daily price variations are becoming more pronounced, and the market may experience more price fluctuations shortly.
Additionally, the low influx of new demand for WIF throughout the past week raises concerns about the robustness of the ongoing uptrend. Data from holderscan.com indicates only 2,715 new WIF holders have emerged, reflecting a modest 1.50% increase in holder count over the last seven days.
When the price of an asset rises without a corresponding surge in demand, it may signal that investors are acting on speculation or fear of missing out (FOMO). Such price trends are often vulnerable to abrupt reversals.
WIF Price Forecast: Likely Decline Once Buying Pressure Eases
WIF’s price may experience a setback once buying pressure diminishes, likely leading to a retest of the support level at $1.96. Should this level fail to hold, the meme coin could decline towards its low of $1.07 reached on August 5.
Read more: Dogwifhat (WIF) Price Predictions for 2024/2025/2030
Conversely, if speculation continues to fuel its upward trajectory, WIF’s price could potentially escalate by 75%, hitting $4.04 — a price point not seen since May 29.
Disclaimer
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