Dogwifhat price sets for 12% rally

Dogwifhat (WIF) price broke above a descending trendline on Monday, suggesting a potential bullish move. At the time of writing, it is slightly up 1% at $2.171 on Tuesday. Additionally, WIF's price action reveals the formation of a double bottom pattern, signaling a possible trend reversal on the horizon.

Dogwifhat price shows potential for a rally

Dogwifhat's price peaked at $2.361 in the second half of June after bouncing off the $1.547 level. This support level has been tested again recently. This 'W’-like structure (double-bottom pattern) is a bottom reversal pattern that often hints at a potential trend reversal, favoring the bulls. If bullish momentum persists and WIF can break the resistance at $2.361, it is likely to rally 12% to $2.644, the high from June 17. 

The Relative Strength Index (RSI) on the daily chart is firmly above the neutral level of 50, while the Awesome Oscillator (AO) is on its way to doing the same. If bulls are indeed making a comeback, then both momentum indicators must maintain their positions above their respective mean levels. Such a development would add a tailwind to the recovery rally.

Furthermore, surpassing the $2.644 level could pave the way for an additional 16% rally to retest $3.087, the 61.8% Fibonacci retracement level drawn from a swing high of $4.080 from May 29 to a swing low of $1.482 from June 24.

WIF/USDT daily chart

However, if Dogwifhat's daily candlestick closes below $1.482, the price will form a lower low relative to the June 24 low, resuming WIF's downtrend. This will refute the bullish argument, leading to a 33% crash to retest its March 5 low of $1.