UNI must hold the $13.20 support to confirm a reversal in the bearish momentum.
Market optimism grows with the increase in active addresses, decrease in exchange reserves, and liquidation imbalance.
Uniswap [UNI] has attracted a lot of attention after triggering a TD sequential buy signal on its 4-hour chart, sparking optimism about a potential recovery.
Trading at $13.17 at press time, down 11.89% in 24 hours, UNI is at a critical crossroads.
The $13.20 support level is crucial for the token to stabilize and reverse its recent downtrend. Therefore, traders are closely watching to see if this signal can provide UNI with the momentum it needs to rebound.
UNI Price Analysis: Can Support Hold?
UNI is facing strong selling pressure, as shown by its sharp drop from $15.32 to its current price range.
Fibonacci retracement levels highlight the $15.90 and $17.06 resistance levels, which UNI must break to resume its upward momentum.
However, the Parabolic SAR (SAR) was at $14.90 at press time, suggesting that the bearish trend will persist unless the $13.20 support holds.
Failure to hold this area could lead to a further drop to $12.88, sparking concerns among investors. Hence, all eyes will be on whether buyers can regain control at this crucial level.
Cautious optimism remains
UNI’s on-chain metrics present a mixed picture, with slight improvements in network activity providing cause for cautious optimism.
Active addresses increased by 1.12% over the past 24 hours, indicating a slight increase in user engagement.
Additionally, the number of transactions grew by 1.01%, reflecting an increase in network usage. However, these increases are relatively small and may not indicate a strong reversal in sentiment.
Therefore, while the fundamentals are showing some resilience, they are not yet strong enough to trigger a clear recovery.
Falling foreign exchange reserves mean…
UNI’s exchange reserves have decreased by 0.75% over the past 24 hours and stand at 68.63 million tokens at press time. This suggests reduced selling pressure as fewer tokens are available for trading on exchanges.
However, this also reflects cautious market sentiment, with holders choosing to wait rather than actively buy or sell.
Therefore, while this trend is slightly positive, it remains uncertain whether it can drive sustained upward momentum.
Liquidation data highlights market uncertainty
Liquidation data provides further insight into market sentiment. Long liquidations totaled $3,978,900, far exceeding short liquidations totaling $967,300.
The imbalance reflects cautious optimism among buyers, who appear to anticipate a rebound.
However, the market remains divided on whether a recovery is imminent as UNI still faces strong resistance. Therefore, traders should proceed with caution while monitoring key price levels.
Can Uniswap regain its bullish momentum?
UNI’s rebound potential entirely depends on whether the $13.20 support level holds.
Although the TD sequential signal and on-chain indicators suggest a possible recovery, the broader bearish trend remains a significant hurdle.
A break below $13.20 could lead to further declines. Therefore, UNI must decisively hold its support levels to resume the upward momentum while the optimism remains.
