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Uniswap (UNI) Breaks out From 406-Day Resistance Line

2 mins
Updated by Geraint Price
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In Brief

  • UNI has broken out from a descending resistance line.
  • There is resistance at $8.40 and $15.
  • UNI is following a short-term ascending support line.
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Uniswap (UNI) is attempting to create a higher low after breaking out from a long-term descending resistance line.

UNI has been falling underneath a descending resistance line since reaching an all-time high price of $45 in May 2021. The downward movement led to a low of $3.33 in June. This was also combined with an all-time low value in the weekly RSI (green icon). 

However, the price has been increasing since and broke out from the line. At the time of the breakout, the line had been in place for 406 days. Breakouts from such long-term structures usually mean that the preceding trend has come to an end.

So far, the price has reached a high of $9.83. But it has failed to reach a close above the $8.40 horizontal resistance area. Additionally, the weekly RSI has failed to move above 50.

Both of these would be required in order to confirm the bullish trend reversal. In that case, the next resistance area would be at $15.

UNI Resistance
UNI/USDT Chart By TradingView

Short-term support

The daily chart shows that UNI has been following an ascending support line since June 18. Currently, the line is at $7.45, coinciding with a horizontal support level. Therefore, it is possible that the line causes a bounce. This possibility is also supported by the daily RSI, which seems to be approaching the 50 line from above. 

If a breakdown were to occur, the 0.5-0.618 Fib retracement support levels at $5.80 to $6.60 would be likely to create a higher low, in turn resuming the upward movement.

Daily ascending support line
UNI/USDT Chart By TradingView

UNI wave count analysis

Cryptocurrency trader @Thetradinghubb tweeted a chart of UNI, stating that the price might have begun a new long-term bullish reversal.

UNI movement
Source: Twitter

The most likely wave count suggests that UNI has completed a five-wave upward movement, and is now in the process of completing an A-B-C corrective structure. If so, it is currently nearing the bottom of wave A. 

The most likely area for the correction to come to an end if between the 0.5-0.618 Fib retracement support levels at $5.80 – $6.60. A decrease to the 0.618 level at $5.80 would also sweep the lows of wave four, making it an ideal place for a bottom.

Afterward, the upward movement towards the $15 horizontal resistance area would be expected to continue.

UNI Count
UNI/USDT Chart By TradingView

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In line with the Trust Project guidelines, this price analysis article is for informational purposes only and should not be considered financial or investment advice. BeInCrypto is committed to accurate, unbiased reporting, but market conditions are subject to change without notice. Always conduct your own research and consult with a professional before making any financial decisions.

Valdrin Tahiri
Valdrin discovered cryptocurrencies while he was getting his MSc in Financial Markets from the Barcelona graduate school of Economics. Shortly after graduating, he began writing...