The Uniswap Token (UNI) price halted its decrease on Sept 22, but the resulting upward movement was weak and has already retraced. A drop below $3.78 is expected to accelerate the rate of decrease.
UNI has been decreasing since Sept. 25, when the price reached a high of $5.55. The decrease has followed a descending resistance line, which has rejected the price thrice until now.
UNI Failure to Launch
At the time of press, the UNI price was trading inside the $3.85 support area.
If UNI breaks out from the descending resistance line, the next resistance area would likely be found at $4.85.
The slightly longer-term view shows that the price is currently trading near the 0.618 Fib level of the entire upward move. A breakdown below this could trigger a rapid dip to $2.85 or possibly lower.
The RSI is below 50 and has not generated any bullish divergence, making it likely that the price will eventually break down.
The UNI increase since the Sept 22 bottom looks corrective rather than impulsive due to the significant overlap between new highs and lows. On the contrary, the decrease since Sept 25 looks impulsive, indicating that the trend is likely bearish.
The wave count suggests that the price completed an A-B-C correction between Sept 22-25, and has been decreasing alongside a bearish impulse since (both shown in red).
If so, the price is currently in wave 5. A preliminary target for the end of this wave could be found near $2.98, fitting with the support area previously outlined.
To conclude, the UNI price is expected to eventually break down from its support area and head towards new lows.
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