Disclaimer: The information presented does not constitute financial, investment, trading or other advice and is solely the opinion of the author.
- Lido token maintained its strong uptrend on the higher time frame charts.
- The $2.2 and $2.55 levels have been critical for the past two weeks, and the bears have so far refused to yield $2.55-$2.7.
Lido Finance [LDO] token has been hovering below a key resistance level since mid-November. A whale transferred 500k tokens recently to Binance, raising concerns about a spike in selling pressure.
Lido also benefited from the rising popularity of Blast, an emerging layer 2 blockchain. The influx of ETH deposits could increase Lido’s control over Ethereum.
With technical analysis also pointing towards bullishness, should investors buy LDO in anticipation of another rally?
The $2.2 support has been resolutely defended over the past three weeks
Source: LDO/USDT on TradingView
The three-day map showed a continuous march north for LDO since mid-October. The resistance zone of $2.55 had not yet been breached and has been an important level for the bears since April. The recent rejection brought Lido prices back to $2.2.
However, the market structure remained bullish and the RSI showed strong upward momentum on the higher time chart. On-Balance Volume (OBV) climbed higher in November
The Fibonacci retracement and extension levels (light yellow) highlighted that $1.91 and $1.71 could be key support levels if $2.2 were to fail in the coming weeks. On the other hand, a move past the local highs of $2.65 would likely lead to a rally to $3.4.
The declining active addresses may cause concern among investors
Source: Santiment
LDO’s MVRV ratio reached a high not seen since March on November 22. This was followed by a wave of profit-taking by holders, sending LDO prices down to the $2.2 area.
At the time of writing, the MVRV ratio was still high and could entice more holders to book profits.
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The average coin age has been trending higher since early November, indicating network-wide accumulation. At the same time, the measure consumed by age remained quiet.
This showed an increase in the movement of dormant tokens that has not yet been observed. A significant spike would be an early sign that holders could start selling their LDO shares, leading to a price drop.
