- Uniswap displays bearish tendencies with a precarious bounce off the $5.7 support level.
- Despite the bearish bias, Uniswap network growth showed a surge on July 21, prompting a bullish outlook on higher timeframe charts.
Navigating Through Uniswap’s Bearish Waves
Uniswap (UNI) finds itself caught in the clutches of bearish momentum, a trend visibly outlined on the 4-hour chart. Despite this, the cryptocurrency exhibits a glimmer of hope as the $5.7 support level triggers a positive reaction, suggesting potential for range formation.
On July 21, Uniswap’s network growth spiked, propelling the token’s price to touch the $5.8 resistance zone. However, the bears reasserted control, steering the price downwards. This contrast creates a compelling narrative when viewed against the bullish picture painted by higher timeframe charts.
Range Formation Amid Bearish Dominance
The repeated testing of the $5.7 support level hints at a possible weakening of bullish forces. Observations from lower timeframe charts corroborate this bearish bias in UNI’s price action. Currently, Uniswap finds itself ensnared in a resistance zone above $5.8, with doubts cast on the bulls’ ability to drive the price higher.
The Visible Range Volume Profile reveals the formation of a trading range between $5.7 and $6.23, the Value Area Low and High (blue), with the Point of Control (red) at $5.87 since July 14. Notably, this level does not represent the mid-range mark. The bearish price structure of UNI becomes evident as it slips below the $5.95 mark (orange) and further descends beneath the $5.83 support on July 24.
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Despite the bearish onslaught, a minor bounce from the $5.7 level is noted over the past 24 hours, with UNI trading at $5.843 at the time of writing. The RSI, below the neutral 50 but on the rise, reflects this bounce. The Chaikin Money Flow (CMF) index, however, lies below -0.05, indicating a significant outflow of capital since July 24. The Directional Movement Index (DMI) does not signal a strong trend, further reinforcing the possibility of range formation.
Insights from Coinalyze underscored strong bearish sentiment on July 24. The spot Cumulative Volume Delta (CVD) saw sharp dips on July 18 and 24, aligning with Uniswap prices facing rejection at the $6.2 resistance, close to the range highs. Similarly, the Open Interest (OI) also nosedived on these dates. Despite a recent minor bounce from $5.7, the lackluster response from OI and spot CVD indicates that the bears maintain a firm grip on Uniswap’s fate for now.
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