Uniswap whales rack up UNI dumped by larger wallet holders as Uniswap price tests key level

Uniswap price has been finding difficulty in recovering the losses it witnessed over the past four weeks, and by the looks of it, some investors are losing confidence in the asset as well. However, the whales clearly are not giving up on the DeFi token, pushing onwards by balancing the skepticism from other investors.

Uniswap price fails to recover

Uniswap price trading at $4.60 is standing slightly above the support line at $4.47, which was tested just a week ago by the altcoin. While UNI bounced back, it failed to sustain any rise, resulting in no recovery of the 27.5% drawdown noted around mid-August. 

As noted on the Relative Strength Index (RSI), the bearish momentum has not completely diminished, and chances of a decline persist. The indicator is still in the bearish zone, just above the oversold zone’s threshold of 30.0. A decline in this area in the past has been associated with a reversal in the momentum from bearish to bullish.

UNI/USD 1-day chart

But the bullish momentum would only be reinforced when the RSI breaches the neutral line at 50.0. Since this evidently has some time, some investors are continuing with their approach of dumping before being dumped. In order to prevent losses from the market, UNI holders are offsetting them by selling as prices decline.

UNI whales collect other investors’ dump

The addresses holding 1 million to 10 million UNI have been noted to sell nearly 7 million UNI since the beginning of the month. This supply was simultaneously picked up by whale addresses - 100,000 UNI to 1 million UNI holders. In the past three weeks, they have accumulated about the same amount of UNI, bringing their holding to 99 million UNI from 92 million UNI.

Uniswap supply distributions

Since these addresses’ movement has a sincere impact on the price action, their accumulation would keep Uniswap from falling below $4.47. Further addition of supply to their wallets would work in favor of the cryptocurrency, potentially pushing its price up. Should the altcoin breach the $5.02 resistance level, it would invalidate the bearish thesis and send UNI towards $5.50.

Nevertheless, the protocol is struggling in the Decentralised Finance (DeFi) market. The total value locked (TVL) on the chain has been declining for months, with another $400 million declined removed from the chain throughout August.

Uniswap total value locked

Thus, the possibility of a drawdown cannot be completely ruled out.