Ethereum
Uniswap decouples from Ethereum: will UNI keep $9?
- The exchange supply for UNI is increasing while it is decreasing on the Ethereum network.
- Declining sentiment, triggered by falling demand, indicates that ETH could fall to $9.20 in the near term.
Over the past seven days, Uniswap [UNI] the price and Ethereum [ETH] failed to move in the same direction. At press time, UNI was changing hands at $9.98, representing an increase of 2.22% over the past seven days.
The price of ETH, on the other hand, was $3,687. This is a decrease of 2.56% over the same period. However, this is not the major problem.
AMBCrypto observed using on-chain data from Glassnode that the tides could soon change.
The correlation goes out
The evidence of this is reflected in the change in the net position of the stock market. According to our analysis, the net change in Uniswap’s stock position was 733,683 on June 8.
This metric is the total supply of tokens held in exchange wallets. If it is positive, it means that more tokens go into exchangeswhich could lead to a drop in prices.
However, a negative reading suggests increased withdrawals, which could reduce selling pressure. For UNI, the number of tokens held on exchanges has been increasing since June 3.
Source: Glassnode
Therefore, there is a high chance that the price of the token could lose grip on the $9 region if supply remains positive. However, it was a different ball game for Ethereum.
An evaluation of the same metric with ETH indicated an increase in the number of coins removed from exchanges. According to Glassnode, approximately 576,851 ETH have been took of From trading on the same day, 733,683 UNI tokens poured in.
Source: Glassnode
UNI expected to fall further
Therefore, it is possible to see the price of UNI fall while ETH could see a rapid recovery.
If validated, this could be contrary to the price action of cryptocurrencies when the US SEC approved Ethereum spot ETFs.
In the build-up to the announcement, the price of ETH jumped and that of UNI connection with blockchain, he made sure he was heading in the same direction. But how low can UNI go this time?
To check possible targets, AMBCrypto analyzed weighted sentiment, which shows the perception that market participants have around a project. At press time, the weighted sentiment was -0.173.
This negative reading suggests that most of the commentary on Uniswap was leaning towards the bearish side of things. Thus, the demand for the token could fall and could trigger a drop in price.
Additionally, the Market Value to Realized Value (MVRV) Z-score which was 27% a few days ago has fallen to 23.58%. When the MVRV Z score is positive, this implies that the token is in a bull phase.
Source: Santiment
Realistic or not, here it is UNI market capitalization in terms of ETH
On the other hand, a negative ratio suggests a fall into the down cycle. However, the recent decline does not mean that UNI is entering a bearish phase. But it’s a sign that the price could fall off the charts.
At first glance, a pullback to $9.20 seems entirely possible.