Lido DAO price explodes by 26% as the liquid staking platform emerges as the biggest DeFi protocol

Lido DAO boomed over the last 24 months and placed itself among the top five Decentralized Finance (DeFi) protocols. However, over the last 24 hours, the Decentralized Application (Dapp) managed to claim the top spot as the total value locked (TVL) on the protocol reached $5.98 billion, exceeding MakerDAO’s $5.92 billion TVL.

Lido DAO price reacts positively

Lido DAO price noted a spike in the first two days of the new year as the DeFi token’s value rose from $0.95 to $1.21 at the time of writing. The increase came from Lido DAO’s achievement in the DeFi market and is expected to keep the bullishness going for its native token, LDO.

At the moment, Lido DAO price is reeling from the surge in buying pressure as the altcoin hit the overbought mark earlier on Monday per the Relative Strength Index (RSI). Usually, this is an indication of a trend reversal which could lead to the market cooling down. 

However, the Parabolic Stop and Reverse (SAR) indicator contradicts this possibility. The indicator is used to measure the active trend in the case of the asset, which for LDO, is an uptrend.

If this uptrend continues, Lido DAO price will need to breach its immediate resistance level at $1.25 and flip the next barrier of $1.28 into a support floor. This will allow LDO to initiate a recovery rally and tag $1.43, marking a 19% increase in value from its current trading price.

LDO/USD 4-hour chart

Given the lack of bullishness observed in the broader market, there is a possibility of a drawdown as well. 

If the market retracement leads to a correction, Lido DAO price could lose the support of $1.16 and $1.06, leading to the cryptocurrency tagging the critical support level at $0.94. A daily candlestick close below this level would invalidate the bullish thesis and push the price to the six-month lows of around $0.87, marking a 27% drop in value.