Curve Finance: Few factors to consider before jumping into any CRV trade

  • The price of CRV has increased more than 100% since the beginning of the year.
  • Buyers can no longer sustain further price increases as bullish sentiment weakens.

The price of Curve Finance’s CRV token has seen a significant increase, doubling in value since the start of the current bull cycle. Trading hands at $1.08 at press time, the value of the alt is up 107% in the past 30 days, data from CoinMarketCap shown.

Read Curve Finance [CRV] Price prediction 2023-24

As the price of CRV has risen, so has its daily trading volume. According to data from Santiment, CRV’s daily trading volume increased by 200% over the past month. The increase in daily trading volume over the past 30 days has hinted at the altcoin’s increased utility.

Sharks and whales see things differently

The significant increase in the price of CRV over the past month has led to an increase in the daily whale transaction count of more than $1 million. An increase in whale transactions for a cryptocurrency is commonly seen as a bullish indicator and a sign of a strong belief in continued price growth.

Source: Sanctification

An analysis of the distribution of the supply of CRV showed that the recent price increase was mainly fueled by holders of CRV tokens in the range of 1 to 10,000. This group has ramped up their token accumulation, causing their count to rise 2% over the past month.

On the other hand, larger stakeholders holding between 10,000 and 10,000,000 CRV tokens reduced their holdings during the period under review. According to Santiment data, at press time, this cohort held 12.53% of the circulating supply of CRVs. A month ago they held 13.23%.

Source: Sanctification

Closer than you might think

According to the data of coin glass, CRV’s Open Interest has been declining for the past seven days. At $58.56 million at the time of writing, CRV’s Open Interest is down 15% in the past week.

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A decline in the open interest of a crypto asset generally means that fewer futures contracts have been bought or sold for that cryptocurrency.

It can indicate a decrease in market demand and investor interest. A price disadvantage typically follows this decline in demand.

Source: Coinglass

Further assessment of the CRV’s price action on a daily chart revealed that the key indicators Relative Strength Index (RSI) and Money Flow Index (MFI) were pegged to their overbought highs.

These positions are commonly marked by buyers exhausting as they find it difficult to initiate further price hikes. At press time, the RSI was 69.31, while the MFI was 79.32.

While many might be led to believe that the price increase was conclusive proof that bullish sentiment persisted in the market, a look at the Aroon indicator showed that the market’s bullishness had weakened significantly.

At press time, the Aroon Up line was down 42.86%. The Aroon indicator measures the strength of an uptrend by determining how recently the most recent high was reached.

When the Aroon Up line is close to 100, it shows a strong uptrend. On the other hand, if it is close to zero, the uptrend is weak and could indicate a potential trend reversal.

Source: CRV/USDT on TradingView

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