- Uniswap breaks down under an ascending parallel channel following a rejection at $7.
- A reduction in network growth is a crucial bearish signal for the token and the network's adoption.
Uniswap continues to be one of the best-performing decentralized finance (DeFi) tokens in the market. Over the last three months, UNI has recovered by nearly 300% from $1.75 to a new 2021 high of $6.9. However, a reversal seems imminent at the time of writing and is likely to extend to $4.5.
Uniswap rejected from $7 as technicals turn bearish
The flagship cryptocurrency hit $40,000 on Thursday for the first time in history. The entire cryptocurrency market shot upwards in tandem with BTC. Uniswap made a final leap towards its all-time high at $8.75 but stalled short of $7.
At the time of writing, UNI/USD is teetering at $5.58 after the rejection that has proved significant enough to shatter support expected at the ascending parallel channel's lower boundary. For now, all eyes are on the 50 Simple Moving Average on the 4-hour chart to provide the much-needed support.
However, if push comes to shove, Uniswap is poised for an extended downfall towards the 100 SMA. The Relative Strength Index reinforces the breakdown as it spirals quickly to the oversold region.
UNI/USD 4-hour chart
The TD Sequential indicator has recently presented a sell signal on the 123-hour chart. The bearish outlook manifested in a green nine candlestick. Its validation saw massive sell orders triggered and may continue printing one to four bearish candlesticks on the day.
UNI/USD 12-hour chart
According to the "Daily Active Addresses" model by IntoTheBlock, new addresses joining the DeFi network have taken a turn to the south. This could explain the overhead pressure on UNI at the time of writing.
Uniswap new addresses chart
A negative network growth is usually a critical bearish signal for the token's price and the project's future. The number of new addresses that have joined the network in the last 24 hours stands at approximately 1,800 compared to 2,300 on December 31.
It is worth mentioning that the pessimistic outlook will be invalidated if the 100 SMA support remains intact. Buyers are likely to take advantage of the stability at this level to join the market in anticipation of new all-time highs.
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
Is Altcoin Season here as Bitcoin reaches a new all-time high?
Bitcoin reaches a new all-time high of $98,384 on Thursday, with altcoins following the suit. Reports highlight that the recent surge in altcoins was fueled by the victory of crypto-friendly candidate Donal Trump in the US presidential election.
Shanghai court confirms legal recognition of crypto ownership
A Shanghai court has confirmed that owning digital assets, including Bitcoin, is legal under Chinese law. Judge Sun Jie of the Shanghai Songjiang People’s Court shared this opinion through the WeChat account of the Shanghai High People’s Court.
BTC hits an all-time high above $97,850, inches away from the $100K mark
Bitcoin hit a new all-time high of $97,852 on Thursday, and the technical outlook suggests a possible continuation of the rally to $100,000. BTC futures have surged past the $100,000 price mark on Deribit, and Lookonchain data shows whales are accumulating.
Shiba Inu holders withdraw 1.67 trillion SHIB tokens from exchange
Shiba Inu trades slightly higher, around $0.000024, on Thursday after declining more than 5% the previous week. SHIB’s on-chain metrics project a bullish outlook as holders accumulate recent dips, and dormant wallets are on the move, all pointing to a recovery in the cards.
Bitcoin: New high of $100K or correction to $78K?
Bitcoin surged to a new all-time high of $93,265 in the first half of the week, followed by a slight decline in the latter half. Reports highlight that Bitcoin’s current level is still not overvalued and could target levels above $100,000 in the coming weeks.
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.