2020-10-21 02:00 |
Yearn.finance’s price action has been far from bullish over the past few weeks, with bears aggressively selling into each price pump as buyers continue struggling to gain any traction.
There are many different factors behind this descent, including a downturn seen across the aggregated DeFi space, a fractured community, and founder risk that is growing by the day.
Adding to this confluence of bear-favoring factors is rapidly declining yields in the yVaults, which haven’t been able to remain stable due to the decline in the usage of platforms like Curve.
The lack of immense utility has led to less value being captured by the YFI token, which is another reason why it is continuing to descend.
From a technical perspective, analysts are widely noting that YFI may be positioned to see some serious weakness in the weeks ahead.
The overnight decline seen by altcoins has struck a serious blow to the Yearn.finance token, with it now hovering just a hair above its recent lows of $12,000.
One trader is specifically watching an emerging descending triangle pattern that suggests a move down to the sub-$7,000 region is imminent.
Yearn.finance Struggles to Gain Momentum as Altcoins Sell-OffYearn.finance’s YFI governance token has erased all of the gains that it incurred over the past few days.
After plunging to $13,000 late last week, news of Polychain acquiring a large $5m YFI position sent its price rocketing to highs of $16,000.
The sentiment boost this news provided didn’t last long, as the rejection at $16,000 – coupled with the downturn seen amongst virtually all altcoins – has sent its price reeling back to its $13,000 lows.
This is slightly above Yearn.finance’s multi-week lows of $12,000 set during the capitulatory downturn seen just a couple of weeks ago.
This Technical Pattern Could Drive YFI Significantly LowerWhile sharing his thoughts on where Yearn.finance’s YFI might trend next, one analyst explained that a descending triangle formation indicates a move to the sub-$7,000 region could be imminent.
“The goddess of altcoin TA, yfi, is showing a big descending triangle that would send it down to sub $7k,” he said while pointing to the below chart.
Image Courtesy of LedgerStatus. Source: YFIUSD on TradingView.Yearn.finance (YFI) has widely become viewed as a benchmark indicator for the aggregated DeFi sector, which has been captivating the attention and capital of altcoin investors.
As such, where it trends next may depend largely on the altcoin market in general.
Featured image from Unsplash. Charts from TradingView.Similar to Notcoin - TapSwap on Solana Airdrops In 2024
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