- DeFi tokens like UNI, COMP and MKR explode in price
- Analysis of the daily charts
YEREVAN (CoinChapter.com) – Decentralized finance (DeFi) gained bullish momentum, while Bitcoin (BTC) consolidated at $34,213, unable to overcome the $35.000 milestone with any consistency. As BTC did not offer rewards, traders turned to the DeFi sector to hedge their assets. As a result, tokens like UNI, COMP, and MKR rallied, logging substantial gains.
#1 Uniswap (UNI)
UNI, the native token of Uniswap decentralized exchange (DEX), made a 33 percent headway against Bitcoin. The rally initiated on June 28, bringing the UNI/BTC exchange rate to 0.000657 in the London session on July 6. UNI rebounded from a significant support bar at 0.000494BTC (purple bar on the chart below) and shot past the 20-day exponential moving average (EMA-20) and the 50-day simple moving average (SMA-50).
The EMA-20 corrected its trajectory, adopting an upside trend. Should the gains continue, UNI could score a golden cross in the upcoming sessions. The golden cross formation occurs when a short-term MA crosses up above a long-term MA. Thus, it is a predictor of a bullish phase ahead.
Also read: Polygon bulls take a nap as a triangle setup threatens 50% MATIC price crash
#2 Compound (COMP)
The token of Compound Labs, a DeFi platform for building autonomous interest rate protocols for developers, logged a whopping 117 percent gain after an explosive rally initiated on June 27. COMP traded at 0.015 against BTC in the Tuesday session after a week of consistent profits.
COMP registered the much-desired golden cross on the daily chart on Monday, which adds bullish incentive to the upcoming sessions.
The Relative Strength Index (RSI: the purple graph at the bottom of the chart) stood almost 80. In hindsight, the RSI is an overall momentum indicator that reflects how the traders perceive the price of a given stock or token. At an RSI over 70, traders consider the token overbought and might pull their assets to avoid losses. When the indicator is far above the ‘normal’ purple range between 30 and 70, the price is likely to correct downward.
Also read: ADA ascends as Grayscale adds Cardano to the institutional crypto basket.
#3 Maker (MKR)
MKR, the governance token of MakerDAO, a global financial system, enjoyed a 46 percent gain in the same period as UNI and COMP. MKR had a minor setback on July 1, but gaining support from the EMA-20 made it to the SMA-50. The EMA-20 subsequently corrected its trajectory upward, hinting at a possible golden cross. It formed an uptrend similar to the EMA-20 on the UNI/BTC chart.
All three of the DeFi tokens indicated above logged significant gains against Bitcoin in the past week. The hedge trading was aimed at protecting the traders’ assets without having to leave the crypto sector. UNI, COMP, and MKR gained 33, 117, and 46 percent, respectively, while Bitcoin consolidated around the $34,000 value, without a pronounced bias.
Also read: Beijing company suspected of cryptocurrency trading faces China’s central bank’s wrath.
