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(UNI) has increased by 4% since the beginning of the week.
- As hodlers transfer their tokens to more exchanges, sell orders continue to accumulate on top exchanges.
- UNI will face significant resistance at $5.9.
Uniswap (UNI) price has increased by 4% in the last 3 trading days. However, crypto investors are not certain about the bull momentum. Will bears cause another drop?
When altcoin markets increased by 5% on April 26, Uniswap showed a bullish price increase. However, on-chain data shows that Uniswap hodlers are transferring their tokens to exchanges more and more. Could bears be setting up bull traps?
Uniswap Investors Are Sending UNI to Exchanges!
On-chain data shows that Uniswap investors have been transferring a significant portion of their tokens to exchanges in recent weeks. Glassnode’s Exchange Balance metric tracks the real-time balances of a token deposited into recognized exchange wallets.
When examining the graph below, it can be seen that the balances of UNI deposited into exchange wallets increased by 4.2 million tokens between April 2 and April 25. This corresponds to an 11% increase in tokens ready to be traded on the market.
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Investors may aim to make short-term profits when they transfer their assets to exchanges. Therefore, with investors transferring such a large amount of tokens to exchanges in a short period of time, Uniswap may face selling pressure in the coming days.
Bears Are Accumulating Sell Orders
According to data provided by IntoTheBlock, UNI hodlers may be trying to accumulate significant selling pressure on leading crypto exchanges. The Exchange Market-Depth graph provides information on the number of active buy and sell orders placed by investors on leading crypto exchanges.
The Exchange Market Depth graph below shows that active sell orders are rising above current demand. In particular, bears have placed sell orders for 3.4 million Uniswap (UNI). Meanwhile, buyers have only demanded 2.7 million tokens at current prices.
This demand shortage may cause downward pressure on UNI price. When the supply of an asset exceeds demand, the market temporarily becomes saturated.
If Uniswap fails to create significant traction in the coming days, many UNI hodlers may want to lower their prices to fill their limit orders.
UNI Price Prediction: Can It Overcome $5.9 Resistance?
IntoTheBlock’s Global In/Out of The Money data shows that UNI price needs to maintain support at $5.32 to prevent a bearish reversal. However, panic selling by 13,000 hodlers who bought 9.4 million tokens at this price level could cause a drop.
And if Uniswap (UNI) loses this support, hodlers may expect a sharp drop towards $4.7. At this level, 30,000 addresses holding 18 million tokens could provide stronger support.
However, bears could eliminate the bullish outlook by using 61 million UNI tokens held by 36,000 addresses as resistance. But if bulls manage to overcome this resistance, Uniswap price could rise up to $6.50.
This price analysis article is for informational purposes only and should not be considered financial or investment advice. COINOTAG is committed to providing accurate and unbiased reporting, but market conditions can change without notice. Always do your own research and consult a professional before making any financial decisions.