Journalist
Posted:
- DYDX is up almost 4% over the past seven days, but trading volume fell.
- Although the numbers looked positive, some market indicators supported the bears.
We’ve entered the holiday season and mark the final days of 2023. While several cryptos gave their investors profits with Christmas get-togethers, there were a few more, including dYdX [DYDX]reacted differently.
So should investors be concerned about the token’s performance, especially in the coming days?
FUD around DYDX is rising!
Santiment recently posted a tweet highlighting the behavior of some cryptos. According to the tweet, DYDX and several other coins had witnessed a significant rise in negative sentiment.
IIf we consider history, such incidents are often followed by share price increases.
As the markets roll in #Christmas breakincluding the coins that have experienced a particularly extremely negative sentiment $STORJ, $ILV, $LTC, $DYDX. Historically the assets with the most #FUD correlate with a high probability of price increases.
https://t.co/N7XszdTyyQ pic.twitter.com/L96kfDEBYY
— Santiment (@santimentfeed) December 23, 2023
Not just dYdX, but rather AMBCrypto reported that a similar trend was also observed for Litecoin [LTC]. Our analysis showed that LTC’s weighted sentiment fell to -2.415.
Getting back to dYdX, while a drop in weighted sentiment can generally be viewed as a bearish signal, things were different this time.
According to CoinMarketCapthe token has risen more than 4% in the last seven days alone. At the time of writing, the price was trading at $3.14.
However, trading volume declined, indicating investors’ reluctance to trade the token.
Does DYDX expect a price correction?
Since the FUD surge, AMBCrypto monitored the supply of the token to see if there was a sell-off. Our analysis showed that investors still bought the token.
This was evident from the fact that the supply of the token on the exchanges fell sharply, while the supply outside the exchanges increased.
Nevertheless, the whales did not show much confidence the sign, as the supply of prime addresses was decreasing at the time of the report.
Source: Santiment
Upon further digging, AMBCrypto discovered that DYDX has witnessed a rise in liquidations in the recent past. Our analysis of Hyblock Capital’s data showed that investors sold their holdings when the token’s price reached the $3.38 mark.
If the token manages to continue its upward price movement, it must first cross this barrier for the price to continue rising.
Source: Hyblock Capital
The possibility of DYDX maintaining its growth momentum seemed likely if its on-chain metrics were taken into account. For example, the token’s MVRV ratio went up on December 21.
Other positive metrics include dYdX’s number of transactions and number of daily active addresses, which remained relatively high over the past week.
Source: Santiment
To better understand what to expect from the token, AMBCrypto took a look at the daily chart of the token. The token’s Money Flow Index (MFI) registered an increase and moved further away from the neutral point.
Realistic or not, here it is The market cap of DYDX in terms of BTC
The Chaikin Money Flow (CMF) also rested slightly above the neutral zone, increasing the chances of a price increase.
However, the Bollinger Bands told a different story. According to the indicator, DYDXThe company’s price has been in a highly compressed zone, which could prevent an increase in the price in the coming days.
Source: TradingView