Can CVX Continue To Rally After Its 40% Gains Got Squeezed Out?

Convex Finance (CVX) is a decentralized finance (DeFi) protocol on the Ethereum blockchain. Its role is to enhance yield optimization and staking rewards for CRV token holders and liquidity providers.

Moreover, CVX is the native token of Convex Finance. It can be staked on Convex Finance, enabling users to potentially earn some of Curve and Frax LP’s CRV and FXS earnings. The process includes tokenization of platform fees into cvxCRV and cvxFXS, which are then distributed to the CVX stakeholders.

What Did This Week Look Like on the CVX Daily Chart?

The price of Convex Finance (CVX) recorded an impressive rally from June 14th to June 17th, with a surge of around 140% on the daily chart. 

However, the gains were not sustainable and formed a rejection wick, which reduced the gains to 75%. 

CVX 1Day Price Chart | By TradingView

Now, traders are betting on its downturn, as on June 18th, the price traded at $2.805, with a decline of -16.77 % from the last day’s closing.

Convex Finance TVL and Open Interest 

Data shows that the total value locked (TVL) in the Convex Finance decentralized finance (DeFi) protocol hiked by 3% from June 14th to June 17th, and on the 17th, it was $1.342 billion. As of June 18th, the price has declined along with the TVL. It reduced by nearly 4%, which stands near 1.287 Billion, portraying the bearish angle more rigidly.

TVL | By Defillama.com

The total open interest (OI) in CVX increased massively from $1.30 million to $9.19 Million, which in percentage showed growth of almost 750% in the past 3 days. It shows that traders’ open contracts have been boosted, bringing high price volatility. 

CVX Futures OI (USD) | By Coinglass.com

However, on June 18th, the OI declined by 53.43%, reaching $5.97 Million. This implies that traders have closed a large number of contracts in price, causing a sudden decline and indicating uncertainty in the price.

CVX OI-Weighted Funding Rate | By Coinglass.com

Data obtained from CoinGlass shows that the total funding rate aggregated by CVX declined from 0.0097% to negative 1.9928% over the past 48 hours. The chart shows traders have betted rigidly on CVX’s price to fall. However, at some point on June 18th, it recovered to -0.2332%, showing a little positivity in the funding rate.

CVX Daily Chart Analysis And Forecast!

At press time, the daily chart shows a decline after the CVX relative strength index (RSI) surged from 34 to 70 in the past 48 hours. The indicator shows that CVX is at 54.98, which seems to be declining from overbought, and there could be a strong whale manipulation in play. However, MACD still has a bullish crossover with histogram, and 200-day EMA has pushed CVX down towards 50-day EMA.

Therefore, if bearishness accelerates and the nearest support that could aid the CVX price is $2.50 and $2.00. However, if CVX bulls regain traction, the price could reach targets like $3.90 and $4.50 out of the wedge breakout.

Summary

Convex Finance (CVX) Price surged 140%, then dropped 75%. TVL reached $1.342 Billion, then fell to $1.287 Billion. OI increased by 750% to $9.19M, then dropped to $5.97M. The funding rate declined, and RSI showed a decline. Technically, Support is at $2.50 and $2.00, with potential targets at $3.90 and $4.50 if bulls regain traction.

Disclaimer

In this article, the views, and opinions stated by the author, or any people named are for informational purposes only, and they don’t establish the investment, financial, or any other advice. Trading or investing in cryptocurrency assets comes with a risk of financial loss.

Amanda Shinoy is one of the few women in the space invested knee-deep in crypto. An advocate for increasing the presence of women in crypto, she is known for her accurate technical analysis and price prediction of cryptocurrencies. Readers are often waiting for her opinion about the next rally. She is a finance expert with an MBA in finance. Quitting a corporate job at a leading financial institution, she now engages herself full-time into financial education for the general public.