The days and weeks have been tough for investors in Uniswap’s governance token – UNI price.
UNI/USD 4-hour chart | Source: TradingView
The UNI price has been overly exaggerated
UNI was launched, surrounded by an incredible amount of hype and even hysterical. This mainly happened because most traders immediately owned at least 400 tokens when it launched. This hype has allowed its price to skyrocket from a post-listing low of $ 1 to a high of $ 8.5. But this hyperbole was short-lived and was followed by a severe decline.
The UNI price has been caught in an ongoing downtrend since, unable to create any strong buying pressure. One analysis firm noted that yesterday was a particularly difficult day for Uniswap token traders, as $ 2.8 million capital has been released out of crypto after a few fishes big elephant escaped out.
That being said, UNI has seen a notable rebound throughout the past day, which may last significantly longer if bulls can create a short-squeeze that uses the growing number of sell-side positions as fuel for further upside.
UNI starts forming a long-term bottom with the latest rebound
At press time, UNI is trading up over 13% at its current price at $ 3.19, marking a significant rebound from its recent lows of $2.6 that was set yesterday when its price briefly plunged to lows of $2.4.
The v-shaped recovery seen in the time has been promising and could indicate that further upside is imminent for the token in the days and weeks ahead. The Uniswap token’s price tends to closely track the aggregated DeFi sector, essentially making it an index bet on DeFi.
That being said, if this fragment of the market can see a relief rally in the near-term, UNI may also continue higher.
While speaking about Uniswap token’s recent price action, the analytics firm Santiment explained that yesterday marked one of the worst days ever for UNI traders, who lost $2.8 million in total.
They stated:
“UNI traders had their largest ever loss yesterday, as $2.8M in the capital was flushed after whales sold off their holdings, moving from centralized exchanges to DEX trader wallets. The long/short ratio has been revealing that shorts are becoming more prevalent as well.”
The strong rebound was seen in the time since, however, it may signal that yesterday’s decline was capitulation and that significantly further upside could be imminent in the days and weeks ahead.
You can see the UNI price here.
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