What next as Uniswap cracks key trendline support
Disclaimer: The information presented does not constitute financial, investment, trading, or other types of advice and is solely the writer’s opinion.
- UNI cracked the trendline support but hit a bullish order block.
- More long positions discouraged within the 4-hour timeframe.
Most altcoins recorded losses as Bitcoin’s [BTC] price action remains muted. In particular, Uniswap [UNI] shed over 10% as it dipped from its recent high of $6 level to $5 zone. Over the last few days, BTC’s price action wavered around $29.0k, with likely further losses on the cards.
Is your portfolio green? Check out the UNI Profit Calculator
UNI’s pullback hit another key level
Uniswap has been honoring key trendline support (white) since the beginning of the recovery in mid-June. During the uptrend, any pullbacks were mitigated at the trendline support. However, the recent pullback cracked the trendline support and flipped it to resistance, underscoring the increased bearish pressure.
The retracement hit another crucial price zone of $5.67 – $5.96 (cyan). The level was a critical resistance zone in June/July but was flipped to support in mid-July.
Bulls were expected to defend the $5.67 – $5.96 level to secure early July gains. To the south, the next support lies at the previous March low of $5.425.
Conversely, bulls could only regain leverage if they climb above the trendline support to target the recent high ($6.695).
The Relative Strength Index and Chaikin Money Flow recorded negative readings at the time of writing. It demonstrates the limited buying pressure and capital inflows to the UNI market in the last few days.
How much are 1,10,100 UNIs worth today?
Long positions discouraged
Liquidation data from Coinglass confirmed the spot market’s bearish inclination. About $80k worth of wrecked long positions within the 4-hour timeframe. Yet short positions only suffered less than $3k over the same period. The above data indicates a short-term bearish bias which could delay a sharp rebound.
Similarly, UNI’s Open Interest rates dropped from a peak of $83 million on 2 August to around $61 million at the time of writing. The trend supports the short-term bearish inclination in the futures market.