Dogwifhat (WIF), a Solana-based memecoin, has surged 15% over the last 24 hours, reaching a high of $1.98 on Sept. 24. The rebound comes after WIF price dropped 60% from its all-time high of $4.85 six months ago.

Data from Cointelegraph Markets Pro and TradingView shows WIF rose from a low of $1.44 on Sept. 18, climbing 37% to trade at $1.96 on Sept. 24.

WIF/USD daily chart. Source: TradingView

In comparison, the total memecoin market capitalization is up 0.33% to $2.3 trillion, with most of the largest memecoins by market capitalization posting gains on Sept. 24, according to data from CoinGecko.

Price performance of 10 largest memecoins. Source: CoinGecko

Mean reversion or an isolated rally?

Several crypto traders expect Dogwifhat to build on the current momentum to initiate a sustained recovery toward all-time highs.

“$WIF is slowly climbing, and we have been silently accumulating it since support last month,” altcoin analyst Sjuul wrote in a Sept. 24 post on X.

Meanwhile, crypto technical analyst Crypto Jobs said the WIF price was breaking out of a 180-day falling wedge, with $1.98 and $2 being key resistance levels to watch. 

The descending trendline of the falling wedge $1.75 is acting as immediate support for the memecoin. The relative strength index has risen from 53 to 66 between Sept. 22 and Sept. 23, suggesting that the buyers were dominating the market. 

WIF/USD daily chart. Source: TradingView

It is worth noting that WIF’s latest rally has seen it flip crucial levels into support, including the 50-day, 200-day and 100-day EMAs at $1.70, $1.80 and $1.85, respectively. Increased buying from these buyer congestion zones is likely to push WIF higher toward the bullish target of the prevailing chart pattern at $2.55.

Meanwhile, futures traders are doubtful of a quick rebound, with $10.91 million in short positions at risk if the price recovers to $2.02. A further 10% decline down to $1.80 would wipe out $13.63 million in long positions.

WIF exchange liquidation heatmap. Source: Coinglass

Increasing open interest backs WIF’s upside

The surge in the price of Dogwifhat on Sept. 24 comes after a significant jump in its open interest (OI). 

Open interest is a key metric that traders and analysts use to assess market sentiment and anticipate future price movements. 

WIF’s OI rose to $315.95 million on Sept. 24, approximately 30.45%, up from $232.82 million a day prior on Sept. 23, according to CoinGlass data.

WIF open interest across all exchanges. Source: Coinglass

Additional data from Coinglass reveals increasing demand for leveraged long positions in WIF over the last few days, as indicated by perpetual futures funding rate.

WIF average perpetual contracts 8-hour funding rate. Source: Coinglass

Note that the current 0.0073% eight-hour rate translates to a 0.05% cost over a seven-day period, which is not significant for traders building futures positions. Typically, when there is an imbalance driven by excessive optimism, the rate could easily exceed 1% per week over the next few days.

This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.