Uniswap (UNI) is facing bearish pressure, trading at $7.21 after an 8% dip over the past 24 hours. The cryptocurrency market has been feeling the heat from global geopolitical tensions, especially in the Middle East, as traders react to the uncertainty.
Mixed Signals In The Charts
On the daily chart, UNI’s price has approached a critical point as it tests the lower boundary of an ascending parallel channel. A breach below this level could indicate weakened buying pressure and a potential trend reversal. However, the green volume histogram suggests that buyers are still outweighing sellers.
Another indicator, the Relative Strength Index (RSI), stands at 56 and is trending upward, signaling that some traders may be buying the dip. If the RSI crosses above the signal line, it could generate a strong buy signal, potentially pushing UNI’s price higher to test resistance at the 0.786 Fibonacci level of $7.37.
Conflicting Indicators – MACD vs. RSI
Despite the positive signs from the RSI, the Moving Average Convergence Divergence (MACD) presents a different picture. The MACD line has converged with the signal line, and if it crosses below, it could flip the overall momentum to bearish, signaling a possible price drop.
If selling pressure intensifies, UNI may fall to test support at the 0.382 Fibonacci level, around $6.43. Traders should keep a close eye on the MACD for further signs of weakening momentum.
Looking at Uniswap’s liquidation heatmap, there is a notable cluster of liquidations between the $7.30 and $7.80 range, indicating strong resistance. If UNI gains and approaches these levels, it could force short-sellers to close their positions, potentially triggering a short squeeze. This could amplify buying pressure and drive prices higher.
Rising Exchange Inflows – Bearish Sign?
UNI’s price drop coincided with a surge in exchange inflows. Data from CryptoQuant shows that on October 1st, 893,000 UNI tokens were deposited to exchanges, nearly double the inflows from the previous day. This influx suggests growing selling pressure, which could reinforce the bearish trend.
Also Read: Uniswap (UNI) Surges 4.16% To $7.47 – Can It Hit $10 By Q4 2024?
However, not all data points to a bearish outlook. Coinglass reports that 67% of traders on Binance have taken long positions on UNI, signaling bullish sentiment among a majority of traders.
Uniswap is at a critical juncture, with conflicting indicators leaving traders uncertain about its next move. The RSI suggests buying pressure, but the MACD hints at potential bearish momentum. UNI’s future depends on whether it can break resistance and trigger a short squeeze or fall further under increased selling pressure. With global markets on edge, all eyes are on UNI to see how it reacts in the coming days.
Disclaimer: The information in this article is for general purposes only and does not constitute financial advice. The author’s views are personal and may not reflect the views of Chain Affairs. Before making any investment decisions, you should always conduct your own research. Chain Affairs is not responsible for any financial losses.
About The Author
