Uniswap [UNI] maintains strong position despite 20% drop ahead of v4 upgrade

Amidst the general market turbulence, UNI, the primary token of Uniswap, the leading decentralized exchange globally, is potentially facing a notable drop in its price. This is mainly due to the emergence of bearish patterns in its daily price movements.

Analysis of Uniswap (UNI) Technicals and Price Trends

In line with the analysis by CryptoCrypto, UNI recently failed to sustain its critical support at $12.50, a level it maintained for the past three months. Over this period, the token tested this mark more than four times, with each test showing some upward movement.

However, with the breakdown of this support level, sentiment towards UNI weakened, potentially setting the stage for a significant price decline in the near term.

Based on recent price changes and past momentum, there is a strong likelihood that UNI could experience a 20% decrease, reaching the psychological level of $9.50.

It is worth mentioning, though, that despite the recent bearish signals, UNI was still trading above its 200 Exponential Moving Average (EMA) on the daily chart. Essentially, the token has been experiencing an uptrend of sorts, irrespective of its price performance.

$10.20 million Flowing into UNI

Subsequent to the recent support breakdown and the emergence of bearish patterns, there has been a noticeable trend of investors and long-term holders transferring their assets to exchanges, as per data from the on-chain analytics firm Coinglass. Specifically, spot inflow/outflow statistics indicated that exchanges saw UNI inflows amounting to $10.20 million within just the last 24 hours.

This suggests a potential sell-off scenario, which could intensify selling pressure and trigger further declines in UNI’s price.

Anticipated Upgrade for Uniswap

Interestingly, this bearish outlook for UNI coincides with the impending release of Uniswap’s highly awaited v4 upgrade slated for the following week. Uniswap Labs announced on X (previously Twitter) on 22 January that the rollout of v4 would commence this week, enabling developers to test hooks and integrations on-chain.

The project also disclosed plans to deploy all contracts for a complete launch in the upcoming week. This upgrade is expected to improve Uniswap’s fundamental infrastructure and provision of liquidity.