An Advice for New Uniswap (UNI) Investors in the Space

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Most alter­na­tive tokens have record­ed unprece­dent­ed growth as the cryp­to mar­ket recov­ers from the lows seen amidst the June crash. Some of these alts include Uniswap, Loopring and VeChain. Uniswap (UNI), in par­tic­u­lar, has record­ed a sub­stan­tial surge with­in the last few weeks. The impres­sive action saw UNI appear­ing ready to out­shine some alt­coins in ranks.

‘UNI’nterrupted Upside

Uniswap respond­ed well to the June crash that saw it declin­ing beneath $3.6, tak­ing less than 60 days to recov­er the record­ed loss­es. The time­frame saw it gain­ing over 148.83% to explore its cur­rent val­ue areas of $9.005. Fur­ther­more, UNI recov­ered from the dips seen in May and seems pre­pared to inval­i­date April’s loss­es. Nev­er­the­less, the alt­coin might not have what it takes to over­come the $10-lev­el.

That is because its buy­ing momen­tum, which sup­port­ed the altcoin’s upside dur­ing the upward jour­ney, will hit sat­u­ra­tion soon. The reduc­ing UNI sup­ply on exchanges might sup­port such nar­ra­tives. This met­ric hov­ered at 7‑month lows at 59 mil­lion dur­ing this pub­li­ca­tion. Investors have pur­chased more than 4.2M UNIs worth over $37 mil­lion with­in the pre­vi­ous month.

Though this accu­mu­la­tion con­tin­ued till this pub­li­ca­tion, it may stop soon. That’s because the RSI (Rel­a­tive Strength Index shows the token is waver­ing with­in the over­bought region fol­low­ing the FOMO trig­gered by the lat­est ral­ly. While most investors will be prof­it-hunt­ing traders, they might sell soon, trans­lat­ing to an ulti­mate price action drop.

Fur­ther­more, that might hap­pen soon­er than antic­i­pat­ed. Uniswap’s on-chain liq­ui­da­tions have remained some­what high with­in the past few weeks. Mean­while, near-term liq­ui­da­tions remained a con­cern in July, with short liq­ui­da­tions hit­ting near­ly $3 mil­lion at some point. Also, the vol­ume main­tained fluc­tu­a­tions since then.

New investors inter­est­ed in join­ing UNI’s space might adopt cush­ion as the alt­coin seems primed for decline soon. The alt­coin los­es steam fol­low­ing the lat­est mas­sive upside push. More­over, that’s usu­al­ly after a token sees an enor­mous surge. Mean­while, traders can fol­low broad mar­ket cues for pos­si­ble invalidations.

What are your thoughts about the above analy­sis? You can leave a reply in the seg­ment below.

Edi­to­r­i­al cred­it: Vladim­ka pro­duc­tion / shutterstock.com


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