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Disclaimer: The information presented does not constitute financial, investment, trading or other advice and is solely the opinion of the author.
- MKR has a solid bullish structure and the recovery from $1037 pointed to further gains
- The evidence from the On-Balance Volume (OBV) indicator was a concern
MakerDAO [MKR] nearly hit its 2023 high at $1370 on August 2, reaching $1366 a few hours before press time. One of the reasons behind the growth and upward trend over the past three weeks has been the accumulation of MKR whales.
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A message from Look at chain showed that two whales bought millions of dollars worth of MKR in September. On-chain data from Santiment also showed accumulation across the network.
The bulls reveal their intentions to the market after the September price action
Source: MKR/USDT on TradingView
On August 31, MKR saw a higher price spike as a large number of buyers entered the market. This turned the market structure on the 1-day chart bullish, and the Relative Strength Index (RSI) also climbed above neutral 50 that day.
Together they showed a change in sentiment in favor of buyers. Moreover, the Fibonacci retracement levels showed the 61.8% retracement level at $1037 being defended in mid-August. The recent rally to the highs from early August was a strong sign that the bulls have the power to drive the MKR to new highs.
While the price action was extremely positive and called for a rally to the Fib extension levels of $1497 and $1703, On-Balance Volume (OBV) has been in a downtrend for the past six weeks. This was a sign that buying volume was weak. If the rally is not supported by real demand, prices could fall again.
The rising MVRV showed that some selling pressure could seep into the market
Source: Santiment
Apart from Lookonchain’s data, the average coin age has been on an upward trend since early August. This was a sign of accumulation by holders across the network. The weighted sentiment was also positive.
Realistic or not, here is MKR’s market cap in BTC terms
The market value to realized value ratio (MVRV) was deep in positive territory. This could prompt some holders to realize their gains, which would translate into selling pressure on MKR and a possible dip. A move below the USD 1210 level would mean it would be another pullback rather than just a dip.