Following MakerDAO’s announcement of rebranding to Sky, Maker [MKR] has been showing signs of underperformance. The past week witnessed a significant drop in Maker’s price to a nine-month low, and although there are indications of a recovery, various bearish signals continue to persist.
As of the current press time, MKR is trading at $1,600, reflecting a 24% decrease over the past 30 days. Additionally, the token’s market capitalization has declined to $1.4 billion according to CoinMarketCap.
Starting from July, MKR has been establishing lower highs, signaling a prolonged bearish trajectory. The token has been confined within a descending channel, with recent attempts at a breakout in progress.
Breakouts from descending channels typically necessitate a surge in buying volumes for validation. Regrettably, the current scenario lacks the anticipated spike in trading volumes, evident through the dwindling volume indicator.
The volume histogram bars have transitioned into red, accentuating the dominance of selling pressure over buying pressure dynamics.
Conversely, the Moving Average Convergence Divergence (MACD) line is exhibiting a bullish divergence. While the line remains negative, it has surpassed the signal line and begun trending upwards.
Hence, a bullish momentum could be in the developmental phase.
Similar indications are mirrored in the inclined green MACD histogram bars. Notwithstanding, a substantial bullish reversal mandate entails a concurrent surge in buying activities for affirmation.
Maker’s Exchange Flow Statistics
The rebranding of Maker to Sky encountered controversy following the announcement of upgrading the DAI stablecoin to USDS.
Recently, the launch of the USDS stablecoin on Solana [SOL] created a minor upsurge in MKR’s value.
Despite the transient positive aura, exchange data hints at a potential uptick in selling activity. As per CryptoQuant, the MKR exchange supply ratio has ascended to its highest level since April.
This data underlines a noticeable increase in MKR supply on exchanges. Although this may suggest traders exchanging MKR tokens for SKY, it could also signify a heightened selling pressure prompted by the recent price slump.
The influx of buyers is imperative to counterbalance this surplus of sell-side pressure and facilitate Maker’s recovery from its present lows. Nevertheless, traders might exhibit hesitancy in entering the market, given the prevailing bearish trend.
Statistics from IntoTheBlock paint a picture with more bears than bulls, indicating an overall prevailing negative sentiment.