The majority of alternative tokens have recorded growth that is unprecedented as the cryptocurrency market recovers from the lows seen during the crash that occurred in June. Amongst these alternatives are Uniswap, Loopring, and VeChain. In the past few weeks, Uniswap (UNI) has experienced a significant increase in activity. UNI appeared poised to surpass other altcoins in the rankings in light of its remarkable performance.
‘UNI’nterrupted Upside
It took less than 60 days for Uniswap to recover its losses following the June crash, which caused its share price to drop below $3.6. During that period of time, it increased in value by more than 148.83%, reaching its current level at $9.05 per share. In addition, UNI has recovered from the dips seen in May and appears poised to erase April’s losses. However, the altcoin may not have what it takes to surpass the $10 threshold
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This is due to the fact that its buying momentum, which has supported the altcoin’s upside while it has been on an upward journey, will soon hit saturation. The decreasing UNI supply on exchanges may lend support to such explanations. During the time of this publication, this metric was consistently below 60 million, where it had been for the previous seven months. During the preceding month, investors have acquired over $4,2 million worth of UNIs, exceeding $37 million.
Even though this accumulation has continued up until the point where this publication was made, it might stop happening soon. The RSI (Relative Strength Index) indicates that the token is fluctuating within the overbought region as a result of the FOMO-induced rally. Even though the vast majority of investors will be traders seeking to make a profit, they could decide to sell very soon, which would result in an overall decrease in price action.
In addition to that, it’s possible that this will take place much sooner than expected. Over the course of the past few weeks, the number of on-chain liquidations performed by Uniswap has remained at a relatively high level. In July, short-term liquidations continued to be a cause for concern, reaching nearly $3 million at one point. Additionally, the volume has fluctuated since then.
Cushion could be an attractive investment opportunity for new investors who are considering entering the UNI space given that the alternative coin appears to be heading for a decline in the near future. The altcoin loses momentum after the most recent massive upward push. Moreover, this typically occurs after a token’s price has experienced a significant increase. In the interim, traders can monitor broad market indicators for potential invalidations.
In light of the analysis presented above, what are your reactions and thoughts? You may respond in the section below.
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