WIF Fails to Break $1 Resistance, Faces 20% Correction Risk

WIF, a cryptocurrency, has been struggling to break through the $1 resistance level, with bulls holding the $0.81 demand zone but failing to spark a significant rally. The price of WIF retested its former range high as support earlier in June, resulting in a 26% price increase over two days. However, this upward movement was met with resistance at the previous week’s high, indicating a potential bearish reversal.

The 1-day chart for WIF signals a bearish structure. After testing the $1.18 resistance in mid-May, WIF set a higher low at $0.93 before bouncing higher to test $1.18 again. The second attempt to break through this resistance failed, forcing the price below the $0.93 mark and shifting the structure bearishly on 31 March. Recently, WIF attempted to rally beyond $1 but was unsuccessful, further supporting the bearish outlook.

Technical indicators on the daily chart, such as the Chaikin Money Flow (CMF) at -0.17, signal heavy capital outflows. The Moving Average Convergence Divergence (MACD) is near the zero line and on the verge of forming a bearish crossover, which could confirm the momentum shift. The 4-hour chart reveals a CMF at +0.06, following the price bounce from the local low at $0.8. However, the brief move beyond $1.04 suggested a structure shift that is likely to be followed by a reversal, as indicated by a bearish engulfing candle on the H4 chart.

The 2-week liquidation heatmap shows two magnetic zones of importance. The first is just below $0.8, the target of the anticipated bearish reversal. Another liquidity pocket at $1.08 could attract WIF. If short-term demand and speculative interest increase, a breakout past the psychological $1 resistance could be sustained, especially if Bitcoin sees gains in the short term. Otherwise, swing traders may wait for a dip to $0.8 to go long.

Analysts have noted that the price of WIF has been unable to sustain momentum above the $1 mark, despite attempts to push through this level. The resistance at $1 is particularly strong, and any failure to break through could result in a sell-off, driving the price down by as much as 20%. This scenario is supported by the presence of liquidation levels, which are points at which traders' positions are automatically closed due to margin requirements, adding to the selling pressure.

The market cap of WIF remains relatively low, which could exacerbate the impact of a correction. With a market cap under $100 million and a price below $1, the token is particularly vulnerable to market fluctuations. A 20% correction from the current price would significantly reduce its market value, potentially leading to further selling pressure as investors seek to minimize their losses.

Looking ahead, the outlook for WIF remains uncertain. While some analysts predict that the price could eventually break through the $1 resistance and reach higher levels, the current market conditions suggest that a correction is more likely in the short term. The presence of liquidation levels and the strong resistance at $1 indicate that any upward movement will face significant obstacles.

Investors and traders should closely monitor the price action around the $1 resistance level, as this will be a critical indicator of WIF's future direction. A successful break above $1 could signal a bullish trend, while a failure to do so could confirm the bearish outlook and lead to a 20% correction. In either case, the coming weeks will be pivotal for WIF, as the market navigates the challenges posed by the $1 resistance level.