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YFI and MKR Technical Analysis – Is This a Good Time to Invest?

The total value locked (TVL) in DeFi projects has reached a whopping $11 billion as Uniswap has now become the first DeFi protocol to have reached a TVL of $2 billion, according to DeFiPulse.

The Altcoins market, however, did not see any major developments or changes in terms of prices and market capitalization. Once booming with the DeFi craze, even with the launch of the much-coveted UNI token from Uniswap, the hype surrounding current DeFi projects seems to be fading away.

The SCN30 Index has adjusted slightly in the positive from 222 points to 232 points or +4.5% increase. Most DeFi project tokens have remained stagnant, while some of the Altcoins such as ChainLink (LINK) are demonstrating a strong recovery from a swing-low. LINK bounced back vigorously from a local low at $7 and is being traded above $10 at the moment. However, the blockchain oracle project is still far from its all-time high at $20 achieved earlier in August.

During the past 7 days, Bitcoin increased +2.09%, while gold fell slightly at -0.87%. WTI crude oil continues to slowly rise as demand increases, up +1.84% in a week. The equities markets also saw decent recoveries with Nasdaq +1.59% and the S&P 500 +1.09%.

YFI Technical Analysis

Yearn.finance (YFI), the DeFi aggregating platform which skyrocketed to $44,000 in early September before facing major profit-taking has failed to retest the high ever since.

Looking at the chart, YFI is potentially forming a Head and Shoulders (H&S) pattern, which is generally bearish. The first support is located at the neckline at $21,150 and bouncing off this level can send YFI to retest the local high at $32,000.

Breaking below and completing the H&S pattern, however, will result in a plunge toward $17,800 and possibly go down further as low as $13,764. On the fundamental side, there is no major news or developments that have emerged from the creator, Andre Cronje, as it seems like he has moved on to build up new projects.

MKR Technical Analysis

Maker (MKR) is one of the DeFi’s OG. It dominated the market for a while before the DeFi hype kicked in with multiple new projects consistently popping up. The shift of interests towards the newer and more exciting DeFi protocols have been slowly chipping away at the MKR market cap. Nevertheless, the TVL of Maker is still currently ranked second with $1.9 billion worth of crypto assets being locked in the protocol.

On the technical side, MKR is on a clear downtrend despite the latest attempt to regain a foothold at $533. Standing above said level could give MKR another push to the upside but there are still rows of resistance levels lying overhead waiting to push the price back down.

The failed attempt to retake $533 could result in a drop toward $428 which was a previous low. Breaking below this low can be catastrophic and can take MKR all the way to the yearly low created during the March’s panic sell-offs at $190.

Disclaimer: This analysis is the view of the author’s alone, and does not in any way represent trading advice. all traders should trade at their own risk.

You may also want to read: Bitcoin Bounces to Maintain Bullish Structure while Ethereum Consolidates Sideways


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