Uniswap's Epic Rally and the $8 Resistance barrier
Uniswap surges by 20 percent following Bitcoin's repeated breach of $100,000 milestone
Uniswap [UNI] goes ham on May 8th, with a hefty 26% increase, all thanks to Bitcoin breaching the $100K ceiling for the first time in three stinking months. But here's the kicker - on May 9th, before the Yank tank even got moving, UNI racked up an extra 3% boost, totaling a 35% surge in the past 48 goddamn hours.
But can this rally keep going strong into the weekend? Well, the $7.5 to $8 zone might just be the bogey man that puts a stop to the fun.
So, what's the game plan for UNI?
Source: UNI/USDT, TradingView
In Q1, the dump stopped around the $5 mark, the same spot that halted the August 2021 nose-dive. If the August 2021 recovery is repeated, the overhead hurdle at $8 (the horror show zone) would be the next big target for the bulls.
In fact, they might even manage an extra 18-20% bump from the current $6.3, right up to the $7.5 to $8 range. But wait, the Relative Strength Index (RSI) is just a smidge away from the overbought territory, so chances are, we're not gonna see any reversal signs just yet.
And here's the cherry on top - the Average True Range (ATR) is still pretty low, meaning the rally ain't done just yet.
On the flip side, if UNI slips below the 50-EMA (Exponential Moving Average) at $5.8, the bullish thesis is squashed faster than a roach under a boot.
A word of warning for the bulls
Now, it's essential to consider that the $8 wall might be a bit sticky due to a couple of factors. First off, only 8% of UNI holders are in the green currently, but a whopping 61% are barely breaking even.
If things take a dumpster dive, holders at break-even might panic sell to save their stash and put a damper on the rally.
Source: IntoTheBlock
To add insult to injury, Santiment reveals that holders who snagged UNI for the past 30 days have an average unrealized profit of 18%. This could mean that short-term holders jump ship to book their profits.
Taken altogether, the $8 barrier is gonna be a real pain in the butt for the bulls, especially if Bitcoin falls below $100K.
However, should the risk-on sentiment continue and Bitcoin's dominance dips to 60% or below, UNI could aim for the stars and hit $9.5 or even the $10 psychological level.
Disclaimer: This analysis represents the writer's shaky opinion and is not meant to be financial advice or investment recommendations.
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Current Analysis for Uniswap (UNI) Breaking the $8 Resistance Level
Uniswap (UNI) Price Movement and Resistance:
- Recent Price Trend: Uniswap's price has shown a bullish trend recently, climbing up from the $3.60 range to over $6 in the past few months[1]. This substantive price increase hints at increased buying activity and could indicate further growth potential.
- Resistance Levels: The $8 resistance level has historically posed a challenge for UNI, and breaking through it could be difficult without significant momentum and positive market conditions[1]. Some analysts predict the price of UNI could reach $40 in the next five years, but this is based on optimistic market conditions and considerable price increases[3].
- Volatility and RSI: The increasing volatility and a Relative Strength Index (RSI) nearing the overbought region suggest that UNI might face a pullback after recent gains, but sustained buying pressure could help maintain the upward trajectory.
- Bitcoin's Price Influence on UNI: Due to the strong correlation between Bitcoin and many altcoins, UNI's price can often be influenced by the movements of Bitcoin. A strong uptrend in Bitcoin can drive buying activity in UNI, while a significant downturn in Bitcoin can negatively impact UNI's price[2].
- Break-Even Holders: The presence of a significant number of holders at break-even levels means that there is a relatively large group of investors with the potential to liquidate their positions if the price of UNI falls, further exacerbating potential downward movement.
In summary, breaking the $8 resistance level for Uniswap will depend on factors such as market conditions, investor sentiment, and Bitcoin's price movements. Sustained buying pressure and favorable market conditions could help propel the price higher, but the presence of a large number of break-even holders presents a potential obstacle.
- The surge in Uniswap (UNI) by 35% in just 48 hours is attributed to Bitcoin's breach of the $100K ceiling, sparking a broader crypto rally.
- The $7.5 to $8 zone might act as a resistance barrier for UNI's ongoing rally, potentially halting further gains.
- Q1's dump halted around the $5 mark, resembling a potential target if UNI experiences a recovery similar to August 2021's.
- The Relative Strength Index (RSI) is on the verge of entering the overbought territory, indicating potential continued price increases, but not immediate reversal signs.
- The Average True Range (ATR) remains low, suggesting that the rally may persist for UNI.
- A drop below the 50-EMA (Exponential Moving Average) at $5.8 could signal the invalidation of the bullish thesis for UNI, making it vulnerable to downwards price movement.
