Dogwifhat Plunges to March 2024 Levels, OBV Suggests Strong Selling Pressure

Dogwifhat, a cryptocurrency that had been trading within a range around $1.5 in September, experienced a significant decline in recent months. In January, the price of Dogwifhat (WIF) fell from around $1.5 to below the prices from March 2024, with the $0.35 region being the next potential target.

The On-Balance Volume (OBV) indicator made fresh lows during the past two weeks' losses, suggesting a strong selling pressure. The $1 psychological level was briefly defended in late January but quickly capitulated to the sellers. The $0.75 zone, which had previously served as support, appeared to act as a supply zone over the past two days.

A set of Fibonacci extension levels were plotted based on WIF's most recent leg downward on the daily chart. The 23.6% extension level at $0.737 was turned into a resistance level, while the 61.8% extension level at $0.35 was the next target. Despite the daily Relative Strength Index (RSI) being oversold (below 30) over the past week, a price bounce was not guaranteed.

The 1-week liquidation heatmap underlined the $0.69 and $0.74 levels as short-term targets. It was possible that a range formation would play out over the next few days. If the $0.74 level does not see a bearish reversal, the bounce could extend to $0.8. However, the heavy losses in recent days have turned the market extremely bearish, setting up a large number of short liquidations that could push prices higher and induce high volatility.