Lido DAO, the Ethereum-dependent Liquid Staking Derivatives (LSD) platform, is leading the altcoin wave with a significant increase today. As the platform’s native token, it has shown significant value to Ethereum stakers even before the Shapella Upgrade, leading to its recent notable price performance. Moreover, the recent network upgrade has led to bullish sentiment among long-term investors.
LDO price is witnessing huge inflows
The recent increase is driven by the positive momentum in the Lido ecosystem caused by the rollout of Lido V2. This major upgrade, which has been in development for an extended period of time, introduced two major features upon activation: recording and a staking router.
The recovery in LDO’s price coincides with the recent net positive inflows into Ethereum’s proof-of-stake (PoS) contract. For example, the net amount of ETH staked in the PoS contract was 19.27 million ETH on April 11, just a day before the Shapella upgrade.
This figure fell to 90,704 a week later, before steadily recovering, based on data from Nansen. As of May 16, the Ethereum PoS contract held over 20 million ETH, highlighting the rising demand for liquid staking service providers like Lido DAO. This likely increased the price of its governance token, LDO, which fits the story well.
The rise in LDO value was also supported by large-scale Lido DAO holders in the days leading up to the launch of Lido V2, according to data from Lookonchain. This could imply that the ‘buy the rumor’ strategy may have played a role in LDO’s price increase.
What’s next for the Lido DAO Prize?
The current price behavior of the LDO token reflects the great enthusiasm among Lido DAO ecosystem investors caused by this recent upgrade. Data shows that large-scale holders, or “whales,” began a notable accumulation phase about a week earlier.
Analyzed from a technical perspective, LDO’s 50% rebound occurred around the lower trendline of an existing descending wedge pattern. Traditional market analysts typically view a falling wedge as a bullish reversal signal.
At the time of writing, the LDO price is trading at $2.24, up more than 3% in the last 24 hours. Historically, the LDO/USD pair has had a similar rebound, with each rebound pushing the price toward the upper wedge trendline. Now that price is hovering around this upper trendline again, the LDO could break out or pull back to retest the lower trendline.
If the LDO breaks out, the price could rise towards $3.3 in the coming weeks, which represents an increase of around 50% from current levels. Alternatively, if a pullback occurs, the price could fall to around $1.5, a drop of around 30% from the current price. This level previously acted as both a support and resistance point.