Uniswap to return to $14 as UNI finds support and willing buyers

Uniswap price action has been some of the most bearish and worst-performing of the past year. UNI is close to 80% below its all-time highs, but a mean reversion trade may be imminent.

Uniswap price action is highly oversold and likely to experience a mean reversion spike higher

Uniswap price may experience a bullish relief rally due to a combination of time cycles and overextended losses. Since the all-time high of $45 was formed on May 3, 2021, UNI has been in a downtrend. The length of the downtrend is nearly 300 days long – which is essential from a time cycle perspective.

In Gann Analysis, one of the most influential Inner Year Cycles is the 270-day cycle. It is the third most-powerful Inner Year Cycle. Gann wrote that there is a very high probability that an instrument will find a major swing high/low during this cycle, beginning a new 90-day cycle to end the full year.

Because of the 270-day cycle, Uniswap price has an extremely high probability of reversing and creating a new bullish trend – or, at the very least, a robust corrective move.

The Ichimoku Kinko Hyo system compliments the Gann Analysis from a price action perspective. The current weekly candlestick for Uniswap price is developing into a powerful reversal pattern known as a bullish hammer. But more importantly are the large, consecutive gaps between the bodies of the weekly candlesticks and the Tenkan-Sen. At the very least, a violent and swift move to the Tenkan-Sen at $14 is almost inevitable.

UNI/USDT Weekly Ichimoku Kinko Hyo Chart

However, downside risks do remain for Uniswap price. The extended 2021 Volume Profile and 2022 Volume Profile show very thinly traded volume between $9.00 and $5.00. If $9.00 fails to hold as support, bears may push UNI down the 100% Fibonacci retracement near $6.75.