Will Lido surrender another support level to the bears

Post­ed: Sep­tem­ber 27, 2023

Dis­claimer: The infor­ma­tion pre­sent­ed does not con­sti­tute finan­cial, invest­ment, trad­ing, or oth­er types of advice and is sole­ly the writer’s opinion.

• Lido bulls con­tin­ued to be sup­pressed by heavy sell­ing pressure.
• Demand dwin­dled in the deriv­a­tives market.

Lido’s [LDO] bear­ish swing con­tin­ued to trend low­er with price approach­ing a crit­i­cal sup­port lev­el. As of press time, LDO trad­ed at $1.46, just above the $1.4 sup­port level.

How much are 1,10,100 LDOs worth today?

The break of mul­ti­ple sup­port lev­els over the past two months has kept bulls sub­dued with ele­vat­ed sell pres­sure threat­en­ing to crack anoth­er sup­port level.

In the mean­time, Bit­coin [BTC] hov­ered above $26k and could see LDO extend the price decline in the short term.

Sellers curtailed LDO’s September bounce

Source: LDO/USDT on Trad­ing View

The extend­ed bear­ish dom­i­nance saw LDO sink to the $1.4 sup­port lev­el on 11 Sep­tem­ber. Despite the sell­ing pres­sure, bulls put up a sol­id defense with price rebound­ing by 13% between 12 Sep­tem­ber to 19 September.

Yet, buy­ers could not scale the $1.6 resis­tance. This brought sell­ers back into the pic­ture with LDO retest­ing the sup­port lev­el. Fur­ther­more, the on-chart indi­ca­tors high­light­ed the intense sell­ing pressure.

The Rel­a­tive Strength Index (RSI) dropped low­er toward the over­sold zone. In the same pat­tern, the On Bal­ance Vol­ume (OBV) main­tained its slow decline. Both rein­forced the ele­vat­ed sell­ing pres­sure and lack of buy­ing pres­sure in the Lido market.

If the sell­ing trend con­tin­ues, the $1.4 sup­port could cave with sell­ers dri­ving the price toward $1.2. A sub­se­quent defense of the sup­port lev­el by bulls will inval­i­date the bear­ish the­sis and could see a short-term bounce to $1.5.

Real­is­tic or not, here’s LDO’s mar­ket cap in BTC terms

Market demand for LDO dwindled

Source: Coin­a­lyze

Data from Coin­a­lyze showed that the Open Inter­est (OI) trend­ed low­er along with price, under­scor­ing the bear­ish bias.

Sim­i­lar­ly, the Cumu­la­tive Vol­ume Delta (CVD) which mea­sures the mar­ket demand for a token took a nose dive from 9 Sep­tem­ber. This demon­strat­ed that sell­ers had more con­trol over the mar­ket than buyers.