Nov 15, 2024

6thTrade

Uniswap’s native token, UNI, has seen a 5% decline in the last 24 hours and a 5.24% drop over the past week, struggling to gain traction despite a recent Bitcoin rally. This decline underlines UNI’s waning buying pressure, with key indicators signaling potential consolidation or further downside.

UNI’s Momentum and Key Indicators Signal Potential Pause

UNI’s price recently slipped below its short-term Exponential Moving Averages (EMAs), reflecting reduced buying pressure. Although the EMAs still show a bullish structure, this drop below key levels suggests vulnerability. A reversal could still occur, but caution is advised as the token faces further downside risk.

RSI in Neutral Zone

UNI’s Relative Strength Index (RSI) surged to 85 on November 7 following a sharp 50% rally but has since declined to 43.32. This level falls within the neutral range, indicating a balanced market without clear overbought or oversold conditions. A neutral RSI suggests potential stabilization after recent price swings, with room for either consolidation or a new price move, depending on market sentiment.

ADX Shows Weak Trend Momentum

UNI’s Average Directional Index (ADX) currently sits at 19, down from over 40 last week. The ADX measures trend strength; values above 25 indicate a strong trend, while values below 20 suggest weak momentum. With an ADX of 19, UNI’s recent bearish trend appears fragile, hinting that the current downtrend may pause, consolidate, or even reverse if new buying pressure emerges.

UNI Price Outlook: Will It Drop Below $7?

While UNI’s EMA lines maintain a bullish alignment, the price dipping below short-term EMAs reflects fading buying momentum. A bearish crossover of the short-term EMAs below the long-term EMAs could signal further downside, with potential support at $7.5 and $7.1, possibly falling to $6.6.

However, the weak ADX reading suggests that any continued downtrend may lack strength, opening the possibility for a reversal. If bullish momentum returns, UNI could first target resistance at $8.7, followed by a potential rise to $9.6, representing a 14% gain.

Conclusion

With weak bearish signals and a neutral RSI, UNI’s price may see a period of consolidation or a potential trend reversal. Investors are watching closely to see if UNI can hold key support levels or if a new upside move is on the horizon.




Disclaimer: The content of this article is for informational purposes only and does not constitute financial advice. Cryptocurrency investments are highly volatile and may lead to substantial financial loss. Always perform your own research and consult a qualified financial advisor before making any investment decisions. The opinions expressed are solely those of the author and do not represent the views of the publisher or its affiliates. Investing in cryptocurrencies involves inherent risks, and past performance is not a reliable indicator of future results. Please exercise caution.