Disclaimer: The information presented does not constitute financial, investment, trading, or other types of advice and is solely the writer’s opinion.
- UNI was in a correction It could drop below $5.267
- Forecast would be invalidated by a break of resistance above $5.417
Uniswap [UNI] Since the November 2022 market collapse, there have been two successful recovery phases. Each one reached $6.5 However, the most recent phase of recovery was only $5.5 before becoming a correction.
Read Uniswap’s [UNI] Price Prediction 2023-24
UNI was trading at $5.323 as of press time. It threatened to drop below $5.267 support. Even though a downtrend could offer short traders additional profits, technical indicators (12-hour chart and whale action) cautioned against excessive volatility.
Support at $5.267: Is a break below it possible?
Source: TradingView UNI/USDT
In the second phase of UNI’s rally, the token reached $6.5 in early December 2022 after hitting a low of $5.0 in November 2022. It formed a falling channel and then dropped below it into a trading range.
UNI had traded within the $4.967 to $5.417 range from mid-December. It only broke through this level on 4 January 2023 following a massive BTC rally that day. The pattern breakout enabled UNI to hit the 100-period EMA at $5.609, before a correction occurred.
The RSI, CMF and MFI indicators retreated slightly from their upper ranges. This suggests that buyers were losing significant leverage and buying pressure is easing.
UNI could drop below support at $5.267 and settle at $5.130. This level could be used as a target for short selling.
However, the RSI hasn’t yet dropped below the 50-mark midpoint, and the CMF hasn’t yet broken below the zero mark, which would give the bears more leverage. The bulls would win if these indicators were rejected at their midpoints.
If bulls gain momentum above resistance at $5.417 then the previous bearish bias would be invalidated. This bounce would enable the bulls at UNI to target $5.596’s 100-period EMA.
The recent selling pressure came from the dominant whale supplier
Source: Santiment
According to Santiment the dominant supplier group controlled 53% of total supply and had between 10,000 and 100,000 UNI Coins.
This dominant category was responsible for the recent selling pressure, while the next influential category (1K – 10K coins), with 19.5% control, was accumulating.
As such, the dominant market player was at press time and investors could follow it to minimize risk.
Are your holdings looking green? Take a look at the UNI Profit Calculator
UNI’s Open Interest (OI) remained unchanged as the price fell lower
Coinglass reports that the divergence in OI and UNI prices on 2 January was followed on 4 January by a UNI price rise. UNI Binance exchange’s open interest rates fell on 5 January after a decline in UNI prices.
OI remained constant on January 6, when UNI prices dropped even more. This means that futures market demand remained constant despite the price fall.
This could signal a potential momentum shift, but investors should also consider the RSI, CMF and BTC movements in order to see a clear possible trend reversal prior to closing their positions.