The central theses
- After an impressive rally fueled by the “Coinbase Effect”, Maker has taken a 40% nosedive and is now trying to regain a critical level of support.
- Kyber Network, on the other hand, has increased more than 6 times, and various metrics show that there may be more gas in the tank.
- Meanwhile, Aave may prepare for a correction after the significant uptrend.
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The demand for DeFi tokens continues to grow, and Maker, Kyber Network, and Aave are clear examples of this. These cryptocurrencies have seen an impressive rally over the past few months, and this trend could continue.
The manufacturer aims to regain the critical level of support
Maker is one of the youngest beneficiaries of the “Coinbase Effect”. This is a phenomenon where the price of a token can skyrocket after it is listed on the American stock exchange.
In fact, the Ethereum-based DAO saw its price jump nearly 120% after Coinbase Pro announced it would be placing it on its retail platform.
However, on June 11, MKR reached a point of exhaustion as its price plummeted 40%. After making a new year high of $ 730, Maker fell to $ 447.
MKR / USD on TradingView
Data from IntoTheBlock suggests that addresses largely fueled recent price moves involving millions of dollars in MKR, colloquially known as “whales.”
The number of on-chain transactions greater than $ 100,000 was four operations per day at the end of May, but it rose 3,000% after Coinbase’s announcement.
A few days later, the number of significant transactions on the Maker Network peaked at 123 transactions per day, which eventually led to a massive correction.
Number of Large Maker transactions from IntoTheBlock
The IOMAP (IntoTheBlock) model shows Maker is trying to regain the $ 542 level as support. A surge in demand that allows the DeFi leader to overcome this barrier could increase the chances for further progress.
Based on this on-chain metric, the next most important resistance area is between $ 586 and $ 605. Around 843 addresses bought more than 56,000 MKR here.
In / Out of the money at the price of IntoTheBlock
Given the magnitude of the bullish impulse that Maker went through, another downturn cannot be ruled out. If the bears should step in, the IOMAP cohorts show that the most critical area of support seen is around $ 500, where approximately 890 addresses bought nearly 62,000 MKR.
This demand zone must remain in the event of a correction so that the upward trend can resume. Otherwise one could expect further losses.
Kyber Network seems poised for more profits
Kyber Network has had a sizeable rally since the beginning of the year. Since then, this cryptocurrency has risen nearly 640% from a low of $ 0.18 to a high of $ 1.35.
The exponential buying pressure behind this appears to be fueled by mounting speculation about an upcoming protocol upgrade slated for later this year. The hard fork, known as the Katalyst, is to introduce operational bonuses with which KNC owners can earn part of the fees charged by the network in order to ensure security.
KNC / USD on TradingView
Despite the massive gains it has already seen, several technical indexes are showing that Kyber may have more headroom to move higher. For example, the TD sequence indicator is currently showing a buy signal in the form of a red nine candlestick on the 4-hour chart of KNC.
The bullish formation predicts an upswing of one to four candles or the beginning of a new upward countdown. A green candlestick with two candles trading over a preceding green candle can serve as confirmation of the bullish outlook.
KNC / USD on TradingView
In addition, a bull pennant appears to be developing over the same period. The 102% upswing between June 8th and 10th created the flagpole. And the symmetrical triangle that has developed since then formed the pennant.
Another surge in buy orders behind Kyber Network, which allows it to break out of this pattern, could cause the token to surge 47% to $ 1.80.
This target is determined by measuring the height of the flagpole and adding that distance to the breakout point.
KNC / USD on TradingView
Aave is bound for a retracement
Like Kyber Network, the Aave decentralized peer-to-peer lending protocol has seen its price soar since early 2020. So far, this altcoin is up more than 630% and recently passed the market cap milestone of $ 100 million.
We officially hit the $ 100 million milestone! 🥂🎊🎉
Much ❤️ to the Aave & DeFi Fam. We could not have done this without all of your feedback and support!
Dates are credited to @defipulse credits
🔊Sound on pic.twitter.com/v4UXQKpFue
– Aave (aveAaveAave) June 10, 2020
However, Santiment’s Token Age Consumed Index has seen a significant increase in idle LEND tokens moved between addresses in the past few hours. This on-chain metric measures how many coins have recently changed hands times the number of days since they were last moved.
“Spikes in ‘Token Age Consumed’ can signal changes in the behavior of some long-term holders and tend to precede increased volatility in the price movement of the coin,” according to the behavioral analysis platform.
For the past three months there has been a high correlation regime between old tokens changing hands and the price of that altcoin.
For example, in mid-April, Aave fell 10% after Santiment registered a significant number of inactive tokens moving between addresses. Later that month, the open source token without custody fell another 19% as the proportion of old tokens that changed hands began to rise.
Now with around 5 million idle LEND in motion, history could repeat itself, suggesting a downward momentum on the horizon for this DeFi token.
Aave Token Age consumed by Santiment
The TD Sequential Index adds credibility to the bearish outlook. This technical indicator is currently showing a combined 13 candlestick on the LEND 4 hour chart, which is a negative sign. And the upcoming candle holder will likely be a green nine-candle.
The combination of these two bearish formations increases the likelihood of a steep decline.
LEND / USD on TradingView
IntoTheBlock’s IOMAP model shows that in the event of a correction, the most significant support barrier is between $ 0.093 and $ 0.097. Around this price level, around 790 addresses bought almost 18 million LEND.
The strength of this retaining wall will determine whether Aave will continue the formidable run-up it has enjoyed this year.
In / Out of the money at the price of IntoTheBlock
The DeFi market is advancing
According to Anil Lulla, co-founder of Delphi Digital, the narrative about decentralized finance (DeFi) has intensified this year.
While Bitcoin is up nearly 2% in the past 30 days, some DeFi projects, including Maker, Kyber Network, and Aave, are up over 50%.
Santiment has seen a significant increase in the number of addresses containing these tokens, which coincides with the rising prices.
The upcoming launch of Ethereum 2.0 can potentially also spur the development of the aforementioned projects. As a result, Hugh Karp, CEO and Founder of Nexus Mutual, has had a positive impact on the market valuation of various DeFi tokens.
“From our point of view, [Ethereum 2.0 staking] will be very interesting because we want to generate investment returns with the float. We hold part of the ETH so that we can start with it and generate a return, which is obviously very important for insurance companies, ”Karp affirmed.
Given the growing interest in DeFi, investors should pay close attention to this segment of the market as it is set to revolutionize the global financial system.
This message was provided to you by ANKR, our preferred DeFi partner.
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