UNI prices fell on Monday as traders decided to safeguard their profits after the cryptocurrency hit an all-time high in the previous session.
Uniswap’s decentralized exchange governance token fell as much as 5.57 percent to $ 32.34 during the early European session. The recent bearish move extended the correction to 7.92 percent from its milestone high of $ 35.12. Even so, UNI held a strong level near $ 32.31, a level that served as resistance during attempts to recover the token in late February.
Uniswap eyes are collapsing below their tentative support level near $ 32.31. Source: UNIUSD on TradingView.com
The UNI / USD exchange rate technically provides a longer breakdown below its preliminary support to retest any upward trendline slope support that is an ascending channel. The pair were within the stated pattern prior to their breakout on Sunday. Nonetheless, the inability to hold higher levels pushed prices back within the ascending channel and increased the risk of a fake breakout.
However, a break below $ 32.31 could allow traders to see the channel’s lower trendline as their next downside target.
A sharp drop in support level, accompanied by an increase in volume over a four hour period, could lead traders to see a breakout above the channel’s upper trendline followed by a retest of the record high of $ 35.12. In this case, UNI / USD rates could be looking at USD 40 or above levels as the next upside target.
At least the basics support a bullish narrative for the couple.
Demand for UNI
In retrospect, Uniswap is an Ethereum-based decentralized exchange that uses an automated market-making system (AMM) instead of traditional order books. It enables users to become market makers provided they fund democratically selected assets into a pool. In return, they earn fees in UNI tokens based on the level of trading activity.
Liquidity pool participants can use the UNI token to trade other valuable assets, including fiat currencies. You can also manage the Uniswap cryptocurrency to manage the UNI Community Treasury funds, identify the tokens that make up the Uniswap standard token list (tokens.uniswap.eth), and prove ownership of the Uniswap ENS domain name.
The capital paid into the Uniswap Liquidity Pool rose from $ 1.78 billion at the beginning of this year to $ 3.87 billion on Monday. This huge influx coincides with an overall boom in cryptocurrency adoption, fueled by the involvement of companies like Tesla, PayPal, BNY Mellon, Mastercard, MicroStrategy, and many others.
Speculators see value in barter tokens as they expect user demand for them to increase due to the growth of the cryptocurrency market. This enabled cryptocurrencies such as Binance Coin, SushiSwap, FTX Token and others to log record bull runs in 2021.
UNI benefits from the boom.