Many altcoins have seen unprecedented growth as the cryptocurrency market recovers from its June crash lows. VeChain, Loopring, and Uniswap are some of these altcoins.
UNI in particular has risen significantly over the past few weeks. So much so that it looks likely to displace many other altcoins on the rankings.
Uniswap ranks up
After nearly falling below $3.6 in June after the crash, it took less than two months for the altcoin to recover all of its losses. In doing so, it gained more than 148.83% to trade at $9.005 at press time.
In fact, it has also recovered from the May decline, and the alt is offsetting losses from the April crash. Even so, it may not have all the ammunition it needs to break the $10 mark.
This is because the buying pressure that has always been the biggest advantage of altcoins will soon reach a saturation point.
This can be supported by the depleted supply of UNI on exchanges. Currently, it is also at a seven-month low of 59 million. In the last month, investors purchased more than 4.2 million UNI with a total value of more than $37 million. This accumulation can be seen to continue until the time of writing, but may stop soon.
This may be because the altcoin is currently overbought in the market due to the FOMO generated by its rally, as seen on the Relative Strength Index (RSI).Since most investors will be profit-seeking traders, they will likely sell soon, eventually leading to lower price action (Refer to Uniswap price action picture).
On the surface, this may happen sooner than expected. In the case of Uniswap, on-chain liquidations have been quite high over the past few weeks. Short liquidations in particular have been a concern, as at some point in July, short liquidations worth nearly $3 million were recorded. The volume has also fluctuated since then.
Therefore, new investors looking to enter the market now may want to watch the market carefully as UNI may see a correction soon.