Maker DAO’s MKR token was among the best performing in the past four weeks. The bulls have dominated during this time, but multiple factors are currently suggesting that they are about to take a break.
Here is AMBCrypto’s price prediction for Maker [MKR] for 2022-2023
MKR was trading at $1,116 at the time of writing, representing an 89% gain from the latest local low of $581. An impressive bullish performance over the past four weeks. Nevertheless, MKR’s bullish momentum was about to be disrupted, so investors should watch for incoming selling pressure.
One of the reasons for the above expectation was that MKR has retested a long-term bearish resistance line. The latter has been active since August 2021 and has held up strong so far. Interestingly, MKR’s price action has moved just above the same bearish resistance line for the past two days. The subsequent increase has been limited since then.
The impressive rally saw the price of MKR already well into overbought territory. In addition, the cryptocurrency’s Money Flow Index (MFI) revealed that liquidity was flowing out of the cryptocurrency. In other words, some MKR holders were cashing out.
Despite the outflows denounced by the MFI, MKR had not registered a significant drop at the time of going to press. One possible reason for this could be the presence of some demand that lifts the selling pressure. In addition, MKR may favor the bears once that demand fades.
Will MKR bears take over?
Multiple on-chain stats also confirmed that selling pressure increased significantly after the new resistance test. For example, MKR’s ‘age consumed’ metric registered its largest peak in four weeks in the past 24 hours. This indicated that large amounts of coins were moved during the same period.
Meanwhile, the average coin age has fallen to its lowest monthly point in the past 24 hours. This confirmed that more coins have been moved lately. This was also consistent with selling pressure in the overbought zone or resistance range.
A look at supply dynamics confirmed that MKR was currently experiencing a lot of inbound selling pressure. The supply of top addresses grew sharply from 12 to 17 October. The same statistic also confirmed the sharp outflow in the past two days.
The supply of top addresses almost fell to the level of October 12. If we use this to gauge the expected impending decline, the price of MKR could fall below $900 in the coming days.
The retail segment will eventually mimic top addresses/whales, and when they do, MKR will experience heavy selling pressure. While this outcome is highly likely, MKR investors should also keep an eye on the macro outlook. A major shift in favor of cryptocurrencies could provide more upside support, hence a non-zero chance of extended upside.
This post Reasons Maker [MKR] could dip below the $900 level in the coming days
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