Uniswap: Analyzing why UNI remains an attractive bearish bet

Disclaimer: The findings of the next evaluation are the only real opinions of the author and shouldn’t be thought-about funding recommendation.

Uniswap is likely one of the largest decentralized exchanges with liquidity that dwarfs centralized exchanges similar to Binance and Coinbase. Nevertheless, the scale and depth of the market didn’t essentially mirror on the worth chart of the token, which has been in a gradual downtrend since final August. There have been intervals of consolidation interspersed within the downtrend, and that is one thing long-term traders should keep in mind.

UNI- 1 Hour Chart

The value motion has been a collection of decrease highs and decrease lows since UNI discovered a neighborhood prime at $12 in late March. Beforehand, in late February and early March, some consolidation occurred on the $8.2 mark adopted by a rally to $12. Nevertheless, this rally was unable to interrupt previous the highs of early February, which reached $13.

Subsequently, the longer-term pattern may be stated to favor the bears. A flip towards the bullish aspect would wish UNI to interrupt previous the $8.24 stage as soon as extra, and retest it as assist to supply shopping for alternatives.

This might take a while, as each Bitcoin and Uniswap have been each underneath heavy resistance ranges. UNI has some resistance at $6 and $6.88, with a complete lot extra resistance within the $8-$8.2 zone.

Rationale

The symptoms agreed with the worth motion and mirrored a market that has skilled a robust downward pattern from early April. The Superior Oscillator and the MACD each slipped beneath the zero stage at first of April, and proceed to stay in bearish territory.

Furthermore, each the indications dipped decrease than the latest lows, in response to the downward stress of the previous few days. On the identical time, the OBV additionally fell steeply.

Subsequently, long-term traders don’t have any cause to purchase the dip but because the dip may not have ended. As an alternative, they will decide to attend for a breakout previous resistance and the inflow of great demand, and a pointy uptick within the each day OBV.

Conclusion

The momentum and the pattern have been particularly in favor of the bears over the previous month. A bounce towards the $6.8 and $8 ranges could possibly be seen within the subsequent few days, however a shopping for alternative was not but seen.