- Bullish expectations for Uniswap are high for this cycle
- Network metrics are well below their 2021 highs, suggesting further growth is possible
Uniswap [UNI]seemed to be showing strong bullish conviction at the time of writing. Since November 20, the price has risen 97%, while also breaking through a number of important resistance levels along the way. Open Interest also rose 12% in 24 hours – a sign of bullish sentiment.
Technical and on-chain statistics show that Uniswap is now on a strong upward trend. And even more gains can be expected in the coming months. This is despite UNI still being 61% below its all-time high at $44.9 as of May 2021.
Key lower highs have been retested as support
Source: UNI/USDT on TradingView
Uniswap bulls managed to climb past the $17.05 level that marked the March 2024 high. Along the way, the key lower highs of that downtrend, set at $12.93 and #14.64, were both retested as support.
The OBV has risen sharply, as has the price, demonstrating high demand. The RSI was in overbought territory at the time of writing, but had not yet made a bearish divergence. A consolidation in the $16-$17 zone before the next leg could happen in the coming weeks.
The $15.45-$15.95 zone is also likely to be a strong demand zone if UNI’s price were to see a dip southward.
New addresses have yet to start the uptrend
In the previous cycle, the launch of numerous small cap coins on the Ethereum network brought many new addresses attempting to trade these tokens on Uniswap, the largest decentralized exchange (DEX). A similar spectacle is now, and has been, taking place on the Solana [SOL] network with its memecoin frenzy.
Rising new addresses and higher participation lead to rising rates, especially during the later stages of the bull run. If you compare 2021 to 2024, the new addresses count and network costs were below those highs.
While these figures suggested that further long-term growth was possible, other figures suggested that a short-term downturn is likely. Uniswap went through a distribution phase in October and early November, characterized by the declining average coin age.
Read the one from Uniswap [UNI] Price forecast 2024-25
Meanwhile, the MVRV ratio shot up and reached its highest point in March, indicating rising profitability. This showed that the token may be seriously overvalued. Therefore, traders and investors must be willing to take profits and wait for a dip to buy more UNI.
