NEAR Protocol: What Lies Ahead – A Quick Rally or Imminent Reversal?
In the last day, NEAR Protocol [NEAR] has surged by 10.42%, making it one of the top gainers in the market following a month-long decline of 25.79%. This recent increase has sparked mixed sentiments about whether NEAR is poised for a short-term rally or if a bearish reversal is on the horizon.
While the current upward movement is notable, a wider analysis points towards potential hindrances that could impede further growth. If these barriers persist, NEAR might experience a descent into lower price territories.
Steadiness Amid Decreasing Participation
DeFiLlama’s data reveals that the Total Value Locked (TVL) on NEAR Protocol has remained within a consistent range, fluctuating between $259.85 million and $236.58 million.
Currently standing at $253.52 million, this range, although showcasing active engagement, leaves room for either a significant upward rally or a sharp downturn.
TVL signifies the total value of assets locked in a blockchain’s smart contracts, reflecting user involvement across activities like staking, lending, and providing liquidity.
However, TVL alone does not provide comprehensive insights. CryptoCrypto’s analysis of NEAR’s fee data offers a deeper understanding of its on-chain behavior.
Elevated fees typically indicate heightened network activity, while lower fees imply a slowdown.
NEAR recently recorded its lowest fee generation in the last eleven days, collecting $21,680. This decline points towards reduced user engagement, potentially impacting NEAR’s price performance and ecosystem growth.
Mixed Signals in Technical Indicators
Technical indicators for NEAR present conflicting signals, with the Moving Average Convergence Divergence (MACD) signaling a bearish trend, while the Relative Strength Index (RSI) suggests growing momentum.
The MACD on the weekly chart is nearing a potential bearish Death Cross, typically accompanied by a rise in red histogram bars, reinforcing pessimism. If this pattern solidifies, NEAR’s price may trend downwards.
Despite the bearish MACD, the RSI paints a slightly optimistic picture, showing a press time reading of 50.13, implying mild bullish momentum.
Focusing on Key Levels
Looking at the weekly chart, NEAR may initially move upwards into a supply zone before retracing to a support zone, possibly hitting the $2.45 target.
If the supply zone fails to hold, NEAR could ascend further, reclaiming bullish momentum and aiming for a new monthly high.
Despite the potential for a bullish turn, the impending death cross on the MACD and other metrics suggest a bearish outlook for NEAR in the near future.