- Savvy investors have devised a strategy to take advantage of the falling WIF to accumulate stocks before the timing is over.
- However, this could also be a double-edged sword for the WIF.
Dogwifhat (WIF) started September lower, consolidating after an August rally to $2. At $1.553 now, it is on its third consecutive green candle, hinting at a recovery. Optimism is building around the expected Fed rate cut, already pushing BTC past $60,000.
Interestingly, when BTC hit its ATH in March, WIF broke above $4. Since then, both have declined, with WIF seeing a steeper decline.
Analysts now suggest that this decline may have marked the bottom for WIF, with several key catalysts lining up for a potential breakout.
Savvy Investors Have Developed a Strategy to Cope with the Falling WIF
The day WIF tested the $4 ceiling was followed by a spike in positive net flows, reaching up to $19 million. This is typically consistent with day trading strategies, where stakeholders take advantage of gains before momentum fades.
Source: Coinglass
Surprisingly, despite the significant outflows that followed, WIF continued its retracement, eventually falling to $1.
According to AMBCrypto’s analysis, this anomaly could indicate a hidden pattern. While WIF’s price has been falling in tandem with Bitcoin’s decline, the high pullbacks suggest it was part of an accumulation phase, hinting at smart positioning of silver for a future rally.
In essence, savvy investors likely used the low WIF level to absorb selling pressure and prepare for the eventual peak in the token market.
As the market rebounds from a consolidation pause, could this accumulation push WIF to $2 before returning to its original ATH?
Uneven distribution could slow growth
With a market cap of $1.5 billion, there are approximately 998 million WIF in circulation. SolScan data indicates concentrated distribution, with the top 10 holders holding over 40% of the supply.
Source: SolScan
Therefore, the uneven distribution could be a double-edged sword for WIF. It could stabilize the token during an economic downturn, but could also hamper a recovery if major holders lose confidence.
However, given that savvy investors have targeted the bottom of WIF, they will likely remain optimistic about a rally unless the memecoin tests the $2 ceiling, which could still be within reach.
A crucial road to travel
While the accumulation has prevented WIF from falling below $1, it may not be enough to cause a full bullish push, as shown in the chart below.
Source: Santiment
Compared to the mid-July rally, which saw some key factors push WIF above $2, the current momentum is below that surge. USD OI is at $156 million, well below the $356 million seen during the rally.
Realistic or not, here is the market capitalization of WIF in terms of BTC
However, timing is important. The rise in BTC has turned sentiment for WIF positive, signaling growing community interest. A doubling in volume could further strengthen the momentum.
Overall, memecoin appeal is on the rise. If the trend continues and savvy buyers remain confident, WIF could approach $2.
