In a week marked by cryptocurrency market consolidation, Uniswap’s native token, UNI, defied the trend, rising more than 15%, and passing the $10 mark. This rally comes amid positive developments in the Ethereum ecosystem and Uniswap’s ongoing legal battle with the US Securities and Exchange Commission (SEC).
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Riding the Ethereum wave
In addition to the legal battle, the current dynamics within the Ethereum ecosystem it is also driving the UNI price higher. On-chain data reveals significant whale withdrawals from cryptocurrency exchanges following news of a potential Ethereum ETF in sight.
Another new wallet withdrew 213,166 UNI ($1.96 million) from #Binance right now.https://t.co/u15CE864hm pic.twitter.com/kyOBv0TB5G
– Lookonchain (@lookonchain) May 24, 2024
This flight to safety, coupled with the general bullish sentiment around Ethereum, is creating a ripple effect that benefits UNI, a key player in the Ethereum DeFi scene.
From a technical point of view, UNI’s exit from a monthly consolidation phase presents a promising picture. Both technical indicators and on-chain data suggest a potential 25% price increase for UNI.
The token’s recent surge indicates a potential bull run, with analysts targeting a price target of $12.80 if current momentum continues.
Adding fuel to the fire is Santiment’s Age Consumed index, which measures the movement of inactive tokens. Spikes in this index often precede price rises, and the last rise in late April appears to have foreshadowed UNI’s current upward trend.
This on-chain metric reinforces the bullish outlook for UNI, suggesting that investors are waking up to its potential.
Short sellers get burned as bulls take control
The recent price recovery has also been accompanied by a significant increase in commercial activity. Data from Coinalyze reveals more than $1 million in Uniswap liquidations in the last day.
The majority of these liquidations (over $750,000) were short positions, indicating that traders betting against UNI are feeling the heat. This increase in open interest, with more traders going long on UNI, further strengthens bullish control over the token’s price.
Uniswap takes a stand against the SEC
This show of defiance has inspired confidence among investors, who see it as a positive sign for Uniswap’s future. The popular decentralized exchange (DEX) recently received a Wells warning from the regulatory body, claiming that UNI is a security. However, Uniswap has promised to dispute this claim, stating that the SEC’s case is weak.
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The SEC’s case against Uniswap remains unresolved and a negative outcome could dampen investor sentiment. A broader market correction could still impact UNI’s price.
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