Curve Finance: Few factors to consider before you leap into any CRV trade

• CRV’s price has rallied by over 100% since the year started.
• Buyers can no longer support any further price rally, as bullish sentiment weakens.

The price of Curve Finance’s CRV token has seen a significant increase, doubling in value since the beginning of the current bull cycle. Exchanging hands at $1.08 at press time, the alt’s value has risen by 107% in the last 30 days, data from CoinMarketCap showed. 

Read Curve Finance’s [CRV] Price Prediction 2023-24

As CRV’s price rallied, its daily trading volume grew as well. Per data from Santiment, in the last month, CRV’s daily trading volume has increased by 200%. The surge in daily trading volume during the last 30 days hinted at the increased utility of the altcoin.

Sharks and whales see things differently

The significant surge in CRV’s price in the last month led to a jump in the daily count of whale transactions exceeding $1 million. An increase in whale transactions for a cryptocurrency is commonly viewed as a bullish indicator and a sign of a strong belief in continued price growth.

Source: Santiment

An analysis of CRV’s supply distribution showed that the recent price surge was mainly fueled by CRV token holders in the 1 to 10,000 range. This group increased their token accumulation, causing their count to rise by 2% in the last month.

On the other hand, bigger stakeholders that hold between 10,000 to 10,000,000 CRV tokens reduced their holdings during the period under review. Per data from Santiment, at press time, this cohort held 12.53% of CRV’s circulating supply. A month ago, they held 13.23%. 

Source: Santiment

Closer than you might think

According to data from Coinglass, CRV’s Open Interest has been on a decline in the past seven days. At $58.56 million at the time of writing, CRV’s Open Interest has fallen by 15% in the last week. 

Is your portfolio green? Check out the CRV Profit Calculator

A decline in a crypto asset’s Open Interest generally means that fewer contracts for future trades have been bought or sold for that cryptocurrency.

It can indicate a decrease in market demand and investor interest. A price drawback typically follows this declining demand.

Source: Coinglass

A further assessment of CRV’s price movement on a daily chart revealed that key indicators Relative Strength Index (RSI) and Money Flow Index (MFI), were pegged at overbought highs.

These positions are commonly marked by buyers’ exhaustion as they find it hard to initiate any further price rallies. At press time, the RSI was 69.31, while the MFI was 79.32.

While many might be led to believe that the rising price was conclusive proof that bullish sentiment lingered in the market, a look at the Aroon indicator showed that the bullish trend in the market had weakened severely. 

At press time, the Aroon Up line was in a downtrend at 42.86%. The Aroon indicator measures the strength of an uptrend by determining how recent the most recent high was reached.

When the Aroon Up line is close to 100, it shows a strong uptrend. On the other hand, if it’s close to zero, the uptrend is weak and could indicate a potential trend reversal.

Source: CRV/USDT on TradingView