Decoding the reasons behind Maker’s [MKR] upward momentum
- Maker [MKR] has been moving upward for the past 72 hours.
- The recent surge caused short positions to be liquidated.
Short sellers were forced to cover their bets on Maker [MKR] after the asset experienced a sudden and dramatic price increase. The MVRV has shifted position due to the recent pricing movement, making it overvalued.
Read Maker [MKR] Price Prediction 2023-24
Maker trends upwards
Maker’s [MKR] movement had increased before 2 February. As of press time, it had climbed by 17.21%, which meant that it had increased by approximately 29% during the previous four days. But at the time of writing, it was trading at about $882 and had lost more than 4% of its value.
Yet, Maker [MKR] continued to exhibit positive momentum on the daily timeframe despite what appeared to be a price decrease.
The Relative Strength Index (RSI) was still heading higher than 60 and was over the neutral line. Also, it was apparent that the price drop had sparked a price correction. The fall caused the RSI to leave its previous overbought area.
Short positions suffer liquidations
According to CoinGlass data, in the last 24 hours, traders betting on price movements have liquidated short positions worth almost $444,000.
In comparison, investors only liquidated long positions worth $27,000 in Maker (MKR) throughout that time. Short sellers being forced to cover their positions usually leads to a sharp price rise.
MVRV and TVL flash positive signs
According to its Market Value to Realized Value ratio, Maker has been overvalued from the beginning of the year (MVRV).
As of this writing, the asset was high in the overvalued area because the 30-day MVRV was approximately 13.75%. Even though the current position is lucrative for the investors, it was still expensive to take a new position.
The Total Value Locked on Maker (MKR) reflects the favorable price trend of MKR. According to an observation, the TVL was briefly picking up in January. The network’s TVL stood at 7.23 billion as of this writing per DefilLlama.
How much are 1,10,100 MKRs worth today?
Annual fee down, debt ceiling up
In response to feedback from the most recent round of the Executive Vote poll, Maker announced on 1 March that a new pricing structure had been implemented.
According to the announcement, the latest annual fee schedule was now 0.5%. The debt ceiling was also raised from 5 million DAI to 10 million DAI, signaling a lowering of restrictions on borrowing.