- LDO price retested the demand zone and attempted a rebound.
- Technical indicators indicated that a significant bounce could be seen ahead.
Lido DAO (LDO), a liquid staking protocol on the Ethereum Network, has been in a bearish trend and could not be bounced back.
During the start of 2024, it made a local top around the $4 mark near the supply region. Afterward, it showed a severe distribution and continued to drop. It was under bearish influence and has undergone a massive fall in the past three months.
A descending triangle pattern was observed on the daily chart, and it continued to form the lower lows. Meanwhile, it has reached its critical juncture around the $1.50, the demand zone, and tried to settle around there.
However, the bulls were in a make-or-break situation and attempted to revive the gains. Notably, it has made multiple bottoms around the $1.50 mark and conveyed a strong support zone.
A significant trend reversal can be seen if the LDO token crosses the $1.80 mark, the immediate resistance zone.
Lido DAO Reached Demand Zone: Could It Trigger a Pullback?
On the one-day chart, the LDO token has been in a sustained correction and has dropped over 55% in the last three months.
Meanwhile, the token looks oversold, and a significant pullback was due, which could be seen ahead.
Its price action projections favored the mighty bear army. The token has declined significantly and underperformed for the past few weeks.
At press time, the Lido Dao traded at $1.60 with an intraday drop of 0.66%, reflecting flat moves on the chart. It has a monthly return ratio of -31.20% and -17.20% yearly, reflecting short-term weakness.
LDO Price Chart | Source: Santiment
The Daily RSI curve reached the oversold region and noted a negative divergence, signifying a weak momentum. Similarly, the MACD indicator guided a bearish crossover and conveyed a negative stance.
Development Activity and Active Addresses Data Showed a Dip
Amidst the price decline, the development activity data witnessed a significant decline and dropped to the midline region around 18.5. It conveyed a notable decremental move in the aspects of growth.
Development Activity Data | Source: Santiment
Similarly, the active addresses data showed a decrease in the investors’ participation. Also, new addresses have lost their attention due to a significant price correction.
@Cryptorphic, in his recent tweet on X, said that LDO had made a descending triangle formation. It is poised for a significant short-term reversal.
#LDO Technical Analysis in 2-Day Timeframe.$LDO is currently holding a crucial support level at $1.55. $LDO needs to maintain this support level for a decent push toward $2, where the 50 EMA and resistance trendline are located.
— Cryptorphic (@Cryptorphic1) July 28, 2024
A further breakout will likely create a bullish… pic.twitter.com/OjqSOmWjkt
A Tweet by @Cryptorphic | Source:X
Future Market Follows Trend
Over the past three months, the futures market observed a significant decline, as the Open Interest data observed a declining move.
Its Futures Open Interest data has fallen. It noted a decline of over 1.90% to $90.28 Million, signifying a long unwinding move in the last 24 hours.
Despite the price decline, funding rates across the major crypto exchanges remained positive this week.
The token’s funding rate was noted at 0.0103%. It signified that market participants continue to harbor bullish sentiments.
If the LDO token fails to settle the gains around $1.50, it may retest the immediate support zones around $1.30 and $1.10. On the other hand, if it gains any pullback, it may face the upside hurdle of $1.80, followed by $2 ahead.
Notably, the Lido DAO price still guided the bearish projections and displayed fear among its holders. Until the token does not retain the 20-day EMA mark on a closing basis, the downtrend will resume ahead.
Disclaimer
This article is for informational purposes only and provides no financial, investment, or other advice. The author or any people mentioned in this article are not responsible for any financial loss that may occur from investing in or trading. Please do your research before making any financial decisions.
Dr. Naveen Singh is an entrepreneur with achievements in sports, academics, healthcare, innovation, blockchain technology, telecommunications, and philanthropy. He is the Co-Founder and Chief Executive Officer (CEO) of Inery, the first layer-1 blockchain programmed for database management. With Inery, he aligns with his vision of a new paradigm for data to empower web3 and complete decentralization.
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