Lido [LDO] hit a key stiff resistance level, can shorting yield gains

Disclaimer: The information presented does not constitute financial, investment, trading, or other types of advice and is solely the writer’s opinion

• The RSI headed to the overbought zone, making LDO bullish and ripe for reversal.
• Significant whale activity could tip the scale for bulls. 

Lido [LDO] registered an impressive daily and weekly performance. In the past 24 hours, it appreciated 15% and traded at $2.7 at the time of writing. On the weekly front, LDO rallied 14%, according to CoinMarketCap.

However, at press time, the price action hit a key stiff resistance level at $2.8, which could slow down the uptrend or inflict a reversal should more sellers lock gains at the level. 

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Will the $2.8 obstacle attract sellers?

Source: LDO/USDT on TradingView

Since mid-January, LDO has been fluctuating in the  $2 – $3.2 range. Toward the end of March, LDO retested the $2 and saw increased demand at this level.

A pullback retest saw it clear the $2.229 and $2.5 obstacles. The strong rally could also be attributed to a bullish Bitcoin [BTC], which made new highs in the past few days. 

At press time, BTC was constricted to $26.9K – $28.8K, which could delay LDO from overcoming the $2.8 barrier convincingly. As such, sellers could gain market entry and sink the value.

The immediate short-selling targets would be $2.5, $2.3, and $2.2. An extensive downward pressure could set LDO to retest the previous support of $2. 

On the other hand, bulls could gain more leverage if there is a convincing session close above the $2.8 level. Such an upswing, especially if BTC breaks above its range, could set LDO to retest the overhead resistance level at $3.26. 

At the time of writing, the RSI (Relative Strength Index) was above 50, indicating a bullish LDO. But the RSI was inching closer to the overbought zone, which could make it ripe for a price reversal. Similarly, the OBV (On Balance Volume) showed an uptick, indicating increased demand for LDO in the past two days. 

LDO saw significant whale activity

Source: Santiment

There was significant whale activity transacting above $1 million worth of LDO on 4 April. Increased upward pressure on LDO’s price followed, alongside a subsequent breach of the $2.5 resistance.

Similarly, the mean coin age and supply outside exchanges increased in the past few days, reinforcing the intense accumulation phase. 

Read Lido [LDO] Price Prediction 2023-24

At press time, there was another whale activity recorded. A look at on-chain metrics revealed the selling pressure was coming from the 100K – 1M LDO holders’ category as the rest of the whales accumulated. 

Source: Santiment

In conclusion, the stiff resistance at $2.8 could slow the uptrend, but significant whale activity could boost the surge if BTC reclaims the $29K. As such, investors should track BTC price action closely.