Tezos (XTZ), Synthetix (SNX) and Yearn.finance (YFI) lead the DeFi revival

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The strength of Bitcoin’s uptrend (BTC) appears to be increasing as the high-ranking digital asset rose above $ 40,000 earlier today. It’s safe to say that many investors are completely amazed that BTC doubled in value just a month after breaking the $ 20,000 mark.

This suggests that buying continued unabated, signaling strong demand at each higher level. This bullish sentiment has pulled several altcoins higher, with the total capitalization of the crypto market over $ 1 trillion.

Day view of crypto market data. Source: Coin360

Since most altcoins have only recently entered the rally, they can rise vertically in the short term. The melt phase is one of the best ways to get quick returns, but it’s also risky as a vertical rally tends to wear off quickly.

The tokens selected today are in the early stages of their rally and may have room to run to the top. Let’s look at their basic evolutions and chart structure to determine the trend and possible target forward goals.

XTZ / USD

Tezos (XTZ) has taken incremental steps over the past few weeks to spur growth. The first was to cut smart contract gas fees with the Delphi upgrade in November. This was done to attract developers to building decentralized finance applications, collectibles and games.

At the beginning of December, StableTech launched the packaged Ethereum on the Tezos blockchain. This could have resulted in greater user involvement, as the recent sharp rise in gas charges on the Ethereum network is making things more difficult for traders and participants in the DeFi sector.

Tezos continued to improve its offering and announced the launch of its first NFT platform called Kalamint, which is expected to go live later this month. This allows users to create and list NFTs on the marketplace in XTZ.

Recently, Nisbah Capital, the blockchain subsidiary of Saudi Arabia-based Taibah Valley, partnered with the Tezos ecosystem as a corporate banker. This could ultimately promote institutional acceptance in the Middle East and North Africa. While recent developments look positive, it is important to determine if the market is equally excited about these developments.

XTZ rose from $ 1.9505 on Jan 3rd to an intraday high of $ 2.80 today, a rally of 43.55% in five days. This uptrend has put the price at the top of the $ 1.80-2.85 range that the token has been stuck in for the past few months.

When such a basic pattern breaks up, it usually indicates an accumulation by the bulls. The longer the consolidation period, the stronger the rally is likely to be.

XTZ / USDT daily chart. Source: TradingView

The 20-day exponential moving average ($ 2.21) has been rising gradually and the relative strength index (RSI) is in positive territory, suggesting that bulls have a slight advantage.

If buyers can push the price above $ 2.85 and hold the level for a day, it will suggest the start of a new uptrend that has a target of $ 3.90. If that level is scaled, the XTZ / USD pair could retest the all-time high at $ 4.4936.

However, the pair turned away from overhead resistance today, suggesting the bears are selling near $ 2.85. If the price drops below $ 2.40, the pair could remain range-bound for a few more days.

SNX / USD

Coinbase’s December 16 listing sparked a surge in Synthetix (SNX), and the decentralized financial derivatives protocol has built on its strength by expanding its upward trend over the past few days.

Protocol completed a major upgrade called Shaula on December 24th that added bitcoin as collateral, increasing the potential for increasing synth supply. Another function of the upgrade enables users to deposit sUSD as collateral and as Short Synthetic Assets.

During a bull phase, professional traders outperform the markets by making well-timed entries and exits. While it is difficult for beginners to do the same, Synthetix offers users the option to trade with experienced portfolio managers in the dHEDGE pool. This may have attracted several traders to join the community.

These new features and the strong bullish macro trend across the crypto market could be reasons why the total value set in SNX is close to the $ 2 billion mark.

SNX jumped from an intraday low of $ 7.154 on Jan. 1 to an intraday high of $ 13.38 on Jan. 5, rallying 87% in five days. The token is currently consolidating in a strong uptrend, which is a sign of strength.

SNX / USDT daily chart. Source: TradingView

The bears are currently trying to halt the uptrend at $ 13.38, as evidenced by the long wicks on the candlesticks for the past three days. However, the bulls haven’t given up much of the ground and bought the dips, which shows the demand at lower levels.

If the SNX / USD pair doesn’t break below the 38.2% Fibonacci retracement level at $ 11.002, it indicates an aggressive buy by the bulls. If buyers can push the price above $ 13.38, the next segment of the uptrend could begin, which can hit $ 16 and then $ 19.30.

However, the rally of the past few days has pushed the RSI deep into overbought territory, which may consolidate for a few more days before the next trend move begins.

A break and a close below $ 11.002 could signal the possibility of a deeper correction in the 20-day EMA ($ 8.80).

YFI / USD

In the past few months, Yearn Finance (YFI) has teamed up with several notable DeFi projects. Now the team offers high yield investments that charge low fees and reduce risk to client capital. While partnership announcements generate an enthusiastic short-term response from retailers, they usually fail because new product launches take time.

One of the uncertainties that could have bothered the community was the progress made on the second iteration. This was recently fixed by a developer at Yearn who released a development status update.

Yearn Finance founder Andre Cronje released details of a new protocol called “Tokenized Yield Credit”. Immediately after the launch, however, a developer warned that the protocol was being exploited. Such delays and warnings could have kept risk averse investors at bay, and this explains in part why YFI price has been relatively stagnant for some time.

However, on January 7, Binance announced that it would start investing for YFI, and this move could be the reason for the sharp rise in the price of the DeFi token.

YFI rebounded from an intraday low of $ 20,381.88 on Jan. 3 to an intraday high of $ 37,185 today, a rally of 82% in five days. With today’s sharp upward movement, the token has broken out of the section of an inverted head and shoulders pattern.

YFI / USDT daily chart. Source: TradingView

This bullish setup has a target of $ 55,000, but it’s unlikely to go straight to the top. The long wick of today’s candle holder suggests an aggressive sale above $ 34,204.24.

The bears may now try to pull the YFI / USD pair to the neck of the reversal pattern. If the price recovers from this level, the bulls will try again to resume the uptrend.

If the pair rises above $ 37,500, the uptrend could retest the all-time high at $ 43,966.31. If the bulls can push the price above this resistance, the momentum may accelerate and push the pair to $ 50,000 and then to $ 55,000.

This bullish view will be invalidated if the bears sink and hold the price below the cutout. Such a move could invalidate the bullish pattern and lower the price to the 20-day EMA ($ 24,424). The trend could turn in favor of the bears if the USD 18,000 support breaks.

The views and opinions expressed are those of the author only and do not necessarily reflect the views of Cointelegraph. Every investment and trading step is associated with risks. You should do your own research when making a decision.