What’s causing Uniswap’s price to slump?

• Uniswap’s value has dropped by 5% in the last week.
• Day traders have increasingly distributed their holdings since the month began. 

The price per Uniswap [UNI] token has fallen by 5% in the last week amid low demand and the recent imposition of an interface fee of 0.15% on trades involving Ethereum [ETH], wrapped Ethereum [wETH], USD Coin [USDC] and other crypto assets.

Realistic or not, here’s UNI’s market cap in BTC’s terms

In an announcement post on X (formerly Twitter) made on 16 October, the protocol’s founder, Hayden Adams, noted:

“This interface fee is one of the lowest in the industry, and it will allow us to continue to research, develop, build, ship, improve, and expand crypto and DeFi.”

The announcement came on the same day that a large amount of UNI tokens, approximately 15.8 million, were transferred from one wallet to another, representing the asset’s largest token movement since March 2021.

Source: IntoTheBlock

According to on-chain data provider IntoTheBlock,

“Further research has shown that this move wasn’t caused by investor confidence but rather by an internal transfer from the Uniswap team to the vesting contract.”

UNI traders favor sell-offs over accumulation

At press time, the DeFi token traded at $3.89, according to data from CoinMarketCap. Price movements observed on a daily chart revealed that UNI sell-offs have outpaced accumulation since the month began.

This has resulted in a 13% month-to-date (MTD) drop in the altcoin’s value.

At press time, UNI’s Relative Strength Index (RSI) was 31.81. Also, positioned below its center line, the token’s Money Flow Index (MFI) was 36.03. Both momentum indicators began to fall on 1 October and were positioned below their respective center lines as of this writing. 

Following its brief stint above the zero line on 11 October, UNI’s Chaikin Money Flow (CMF) has since been negative. A CMF value below zero is a sign of weakness in the market, as it signals liquidity exit, which puts downward pressure on an asset’s price. UNI’s CMF was -0.15 at press time.

Moreover, the alt’s Parabolic Stop and Reverse (SAR) indicator – which identifies potential reversal points in an asset’s price direction – confirmed the downtrend.

How much are 1,10,100 UNIs worth today?

When the dots that make up the indicator are positioned above the price, it indicates a downtrend. Also, when these dots are closely packed together, it suggests that the trend is strong.

Lastly, the Directional Movement Indicator (DMI) showed that the bears had control of the market at press time and have been in control since 7 October. 

Source: UNI/USDT on TradingView