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Uniswap: Analyzing the why behind UNI’s recovery that halted at $13

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Uniswap bulls halted at $13, unlucky or a simple case of a lack of conviction from buyers?
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Disclaimer: The findings of the following analysis are the sole opinions of the writer and should not be considered investment advice

Uniswap was on a relentless downtrend as the bears sought to drive prices below $8.22, and a lack of demand was evident. The bearish trend hinged on two levels at press time. Even though the exchange is one of the largest decentralized exchanges, its token has had a rough time on the charts in recent months.

UNI- 3 day chart

Uniswap bulls halted at $13, unlucky or a simple case of a lack of conviction from buyers?

Source: UNI/USDT on TradingView

The 3-day chart was employed to understand the severity of the downtrend that UNI has been on. The coin formed a high at $45 in May but has not been able to post a higher high since. Moreover, following the rally in August, the price of the token began to slump on the charts once more. The $30 level refused to be breached.

In the past few months, the price has continued to register a series of lower highs and lower lows, characteristic of a downtrend.

The Fibonacci extension levels (yellow) were plotted based on UNI’s move from $31.41 down to $13.18 and gave a 27.2% extension of this move southward at $8.22. Incidentally, $8.2 has been a place where some demand was seen in the past month.

That said, the bounce was unable to climb past $13 and the market structure continued to be bearish.

Rationale

Uniswap bulls halted at $13, unlucky or a simple case of a lack of conviction from buyers?

Source: UNI/USDT on TradingView

The 3-day RSI has been below the neutral 50 line since late October. It tried to poke its nose back above but was unable to as the price was rejected at $12.49. The Chaikin Money Flow was also below the -0.05 mark to denote strong selling pressure.

The OBV saw a sharp bounce in the past month, but even the OBV has been on a downtrend for nearly a year.

Conclusion

For the bulls, a move past $13 would be necessary for Uniswap to break the bearish market structure. On the other hand, the bears will be looking to drive the price back below the psychological $10 level, and push it beneath $8.2 as well.

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Akashnath S is a Senior Journalist and Technical Analysis expert at AMBCrypto. He specializes in dissecting price action, identifying key market trends through advanced chart patterns, and forecasting both short-term and long-term asset trajectories. His distinct analytical method is grounded in his academic training as a Chemical Engineer. This background provides him with a systematic, process-oriented approach to market data, enabling him to analyze the complex dynamics of financial markets with precision and objectivity. Having actively covered the cryptocurrency space since the landmark 2017 market cycle, Akashnath possesses years of experience navigating both bull and bear markets. This seasoned perspective is critical to his insightful reporting on market volatility and evolution. As an active market participant, Akashnath enhances his analysis with crucial, hands-on experience. This practical application of his technical skills ensures his insights are not merely theoretical, but are also relevant and actionable for an audience looking to understand and navigate trading opportunities. He is dedicated to educating readers on the nuances of technical analysis, empowering them with the knowledge to make more informed financial decisions.
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