Yearn.Finance (YFI) was once the most expensive cryptocurrency token, with the all-time high price of $44,000 at its peak, is not looking good with a massive Head and Shoulders pattern forming ready for a major breakdown.
YFI was one of the OG that sparked investors’ interest in the DeFi space during early August. When this one-man-show project created by Andre Cronje was unintentionally listed on Unswip, the price went up massively from $4,000 to $44,000 or 11 folds within a span of one month.
However, after tracing down from its peak along with the DeFi craze being subsided as early investors began to cash out their profits, YFI price has shown continuous weaknesses. At the latest development, YFI has now completed the Head and Shoulders (H&S) pattern which is a bearish signal. The breakdown now began with the price slipping past the neckline which served as a major support level.
The increase in volume helps confirm the weight of this breakdown. With continuing downward momentum, the first stop should be at $15,900 which was once a resistance before the price broke up to $20K. Failing to hold the level, YFI could retrace down even further to $10,000 or approximately another 40% decrease.
With all that said, H&S pattern is known for a fake-out where price dips below the neckline and then springs back up. This time, especially, the breaking down is happening during the weekend when the order books are thin, speculators waiting to trade should wait for Monday as there might be a bounce to retest the neckline at $21,500. Failing to break back above the neckline, however, should result in a more downside with targets given above.
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