Today, Bitcoin’s price saw a significant drop from the $100,000 level, while the altcoin market remained strong. Among notable performers, dYdX’s price rose more than 35% and reached the $2.5 resistance mark. Spurred by increasing demand and positive news, analysts are optimistic that dYdX price could soon surpass the $3.2 resistance level.
dYdX rises after Trump’s decision
dYdX’s value rose 35% over the past 24 hours to reach a seven-month high of $2.48 on December 6, pushing its market capitalization to more than $1.6 billion. Coinglass data shows that dYdX price witnessed a total liquidation of around $3.9 million, with buyers liquidating around $2.2 million worth of positions.
DYDX’s recent surge was largely driven by news that President-elect Donald Trump has appointed David O. Sacks as director of artificial intelligence and cryptocurrency in the White House.
The increasing interest stems from Sacks’ role in Craft Ventures, a venture capital firm that has invested heavily in DYDX. The link between the newly appointed cryptocurrency authority and the token led to strong bullish sentiment among investors, driving DYDX’s latest gains.
Another factor likely driving the altcoin’s rally is the increasing interest from whale investors. Data from IntoTheBlock shows that net inflows from DYDX whale owners changed from a net outflow of $766,000 in DYDX tokens on December 2 to a net inflow of over $2.2 billion in DYDX tokens on Wednesday, December 4.
When whales start collecting an altcoin, it often causes fear of missing out (FOMO) among retail investors, who rush to buy the altcoin in hopes of making a profit. Additionally, data from DeFiLlama indicates that the total value captured in the DeFi protocol has increased from approximately $226 million in November to over $388 million currently.
However, as the price encountered resistance around $2.5 million, the large transaction volume fell from the high of $15.7 million to the recent low of $3.2 million. This shows the continued retreat from whales amid the increasing volatility in the price chart.
What’s next for the dYdX Prize?
The dYdX price broke above its immediate resistance channels, resulting in a boost towards USD 2.5. However, buyers failed to maintain momentum around that level, sending the price down to the 23.6% Fib level. At the time of writing, dYdX price is trading at $2.3, up over 21% in the last 24 hours.
The upward trend in moving averages and the RSI approaching overbought territory indicate that the path of least resistance is upward. The DYDX/USDT pair could rise to $2.5 and possibly reach $3.2, with significant selling pressure expected.
This bullish scenario could be negated in the near term if the price declines and falls below the 20-day EMA of $1.9. Such a decline would indicate a lack of buyer interest at higher prices, potentially causing the pair to fall to its 50-day SMA at $1.3.