- Uniswap is getting ready to move to new all-time highs around $28.
- A double-bottom pattern suggests that UNI is drawing closer to the breakout point.
- The IOMAP invalidates the upswing, bringing to light the possibility of consolidation.
Uniswap has recovered from the most recent dip to $17. The losses came into the picture after the decentralized finance token (DeFi) hit an all-time high of $24. Resistance intensified, making it difficult for the bulls to rally above $25. Meanwhile, a critical technical pattern suggests that UNI is on the verge of lifting off to new all-time highs around $28.
Uniswap nurtures the ultimate technical breakout
Uniswap is trading at $21 at the time of writing. The cryptocurrency has also stepped above the 50 Simple Moving Average (SMA) on the 4-hour chart, validating the current uptrend.
The Moving Average Convergence Divergence (MACD) hints at the trend is flipping bullish in the same timeframe. The indicator has settled above the midline. In addition to that, the MACD line (blue) almost crosses above the signal line.
A comprehensive look at the chart brings to light the formation of a double-bottom. The pattern is regarded as a trend reversal in technical analysis and forms following extended downtrends, and two “bottoms’ appear on the chart.
As the price nears the second bottom, selling pressure starts to diminish, leading to a bullish impulse. After the price breaks the neckline (horizontal trendline), a significant move follows. In the same way, if Uniswap slices through the neckline, we can expect the price to make a 25% move to new record highs around $28.
UNI/USD 4-hour chart
The expected uptrend could materialize due to increased buying volume since whales appear to be on a buying spree. According to Santiment, holders with 1 million to 10 million UNI have grown significantly over the last 30 days from 57 to 65.
The improvement in these large holders is a positive impact on the price of the token because of the volume they move. Therefore, if buying pressure continues to soar, Uniswap could soon hit a new high.
Uniswap holder distribution
Looking at the other side of the picture
The IOMAP model by IntoTheBlock suggests that Uniswap is likely to consolidate at the current price level before a breakout comes into the picture. A robust seller congestion zone runs from $21.3 to $21.7. Here, roughly 2,300 addresses had previously bought approximately 9.1 million UNI.
Uniswap IOMAP chart
On the flip side, immense support has been put in place to ensure that declines are avoided. For now, the most substantial support runs from $20.3 to $20.8. Here, about 2,800 addresses are profiting from the roughly 13.2 million UNI. It is doubtful that losses will slice through this area, thus validating the consolidation.