- UniSwap breaks above a key descending trendline, opening the door for gains towards $5.5.
- On-chain analysis reveals that whales are still stocking up on the crypto, hence the bullish momentum.
The decentralized finance (DeFi) tokens have retreated extensively in the past few weeks. However, the story is a bit different when it comes to the newly-launched UNI token, and perhaps it’s because it has only been in the market for a few days. UNI commenced trading on Binance around $0.25 on September 17. Later the price rallied to highs of $8.64. However, selling pressure gripped the token, resulting in losses that embraced support at $3.65.
UNI is a token launched by UniSwap, a fully decentralized blockchain platform, providing automated liquidity on top of Ethereum. According to a statement released by UniSwap, UNI was released for “enabling shared community ownership and a vibrant, diverse, and dedicated governance system, which will actively guide the protocol towards the future.”
UNI bounces off support to resume the uptrend
UNI is up over 20% in the last 24 hours, according to the data by CoinMarketCap. Following the support established at $3.65, the crypto bounced back, stepping above the 50 Moving Average (MA) at $4.2. An increase in buy orders pulled the price further up, but high congestion of sellers formed a barrier at $5.5. A retreat from this level held above the 50 MA, giving bulls a chance to regain control.
UNI/USD hourly chart
At the time of writing, UNI/USD is doddering at $4.95 after overcoming the tentative resistance at the 100 SMA in the hourly range. Moreover, UNI is trading above a critical descending trendline. The Relative Strength Index in the same hourly range is almost crossing into the overbought region. A move of such magnitude by the RSI would signal more buying orders as investors rush to capitalize on the expected gains.
IntoTheBlock’s IOMAP model reveals the presence of substantial resistance between $5.02 and $5.17. Based on this metric, 277 addresses previously purchased 10.68 million UNI. Bulls are likely to work hard and hopefully flip this zone into support. If that happens, UNI could extend the bullish leg beyond $5.5.
UNI IOMAP chart
On the downside, UNI is sitting on robust support, presented by the 5,110 addresses that bought 37.4 million UNI in the range, $4.86-$4.99. It is doubtful that declines will break below this zone. However, if they do, the losses could stretch to the region between $4.56 and $4.64, where 354 addresses previously purchased 2.87 million UNI.
Consequently, Santiment’s holder distribution metric highlights that whales have not slowed down on increasing their UNI holdings. For instance, wallets holding between 100,000 and one million UNI have surged from 80 on September 17 to 123 on September 24.
A similar trend has also been recorded for whales holding one million - 10 million UNI, with thier number increasing from 25 to 34 in the same period. Intense buying pressure is behind UNI’s upswing and the whales' uptake of the token continues, we are likely to witness a surge in the value of UNI.
UNI holder distribution chart
Looking at the other side of the fence
It is worth mentioning that resistance at $5.02 - $5.17, as highlighted by the IOMAP model, may prevent UNI from extending the upward leg to $5.5. On the other hand, retreat from the prevailing price level must hold above the 100 MA to avert losses that could retest the 50 MA support.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended Content
Editors’ Picks
Bitcoin Weekly Forecast: BTC nosedives below $95,000 as spot ETFs record highest daily outflow since launch
Bitcoin price continues to edge down, trading below $95,000 on Friday after declining more than 9% this week. Bitcoin US spot ETFs recorded the highest single-day outflow on Thursday since their launch in January.
Bitcoin crashes to $96,000, altcoins bleed: Top trades for sidelined buyers
Bitcoin (BTC) slipped under the $100,000 milestone and touched the $96,000 level briefly on Friday, a sharp decline that has also hit hard prices of other altcoins and particularly meme coins.
Solana Price Forecast: SOL’s technical outlook and on-chain metrics hint at a double-digit correction
Solana (SOL) price trades in red below $194 on Friday after declining more than 13% this week. The recent downturn has led to $38 million in total liquidations, with over $33 million coming from long positions.
SEC approves Hashdex and Franklin Templeton's combined Bitcoin and Ethereum crypto index ETFs
The SEC approved Hashdex's proposal for a crypto index ETF. The ETF currently features Bitcoin and Ethereum, with possible additions in the future. The agency also approved Franklin Templeton's amendment to its Cboe BZX for a crypto index ETF.
Bitcoin: 2025 outlook brightens on expectations of US pro-crypto policy
Bitcoin (BTC) price has surged more than 140% in 2024, reaching the $100K milestone in early December. The rally was driven by the launch of Bitcoin Spot Exchange Traded Funds (ETFs) in January and the reduced supply following the fourth halving event in April.
Best Forex Brokers with Low Spreads
VERIFIED Low spreads are crucial for reducing trading costs. Explore top Forex brokers offering competitive spreads and high leverage. Compare options for EUR/USD, GBP/USD, USD/JPY, and Gold.