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Disclaimer: The information presented does not constitute financial, investment, trading or other advice and is solely the opinion of the author.
- UNI fell below the $4.50 – $4.94 range.
- More long positions were discouraged.
Uniswap [UNI] sellers took control of the market on Aug. 31 and were on the verge of a bearish breakout from the near-term range of $4.50 – $4.94. But the price action moved higher towards the low as of this writing and could present another short opportunity for late sellers.
How many Worth 1,10,100 UNIs today?
In a new development, among the largest DeFi gas consumers, UNI contracts led with a consumption of more than 50%. That underlines its resilience and dominance in space.
Can late sellers take advantage of this?
Source: UNI/USDT on TradingView
The low of $4.5 was a stubborn resistance during the June recovery. As such, it can turn into a bull headache, especially if Bitcoin [BTC] falls below $26,000. If so, the price rejection at $4.5 could push UNI lower towards the June low of $3.64.
Such a downward spiral could give late sellers a short opportunity with an entry position of $4.5. The take profit levels will be $4.2 for conservative players and $0.3.94 for aggressive players. But the latter was a riskier undertaking.
Conversely, a convincing recovery from the lows ($4.5) and a move above $4.67 will invalidate the short setup.
Meanwhile, the Relative Strength Index and Chaikin Money Flow had negative numbers, indicating subdued buying pressure and weak capital inflows.
Long positions are discouraged
Source: Coinglass
According to Coinglass, UNI was more affected by the liquidation of long positions than short positions. More than $860k longs were racked within 12 hours before press time. During the same period, shorts faced liquidations below $10,000, underlining the bearish bias on the higher time frame charts.
Read Uniswaps [UNI] Price Prediction 2023-24
However, weighted financing rates showed impressive signs of recovery, pointing to improving sentiment. However, a move and subsequent close above $4.5 could confirm a bullish bias.
Thus, tracking the BTC movements is crucial for better optimized setup and risk management.