Key Takeaways
- Despite forming a bear flag earlier, MKR bulls invalidated the pattern by breaking above $1,603.
- Maker’s market price now exceeds its realized price of $1,609 for the first time since May 7.
- MKR surged above a descending channel, indicating a possible break above the $2,036 resistance.
MKR, the governance token of the Maker Protocol, which is currently undergoing a complete rebrand to Sky, has jumped 16% today. At press time, the Maker crypto price is trading above $1,800.
This marks its highest price level since May 13. However, the question is whether MKR might continue to hit higher prices.
Based on both on-chain data and technical indicators, the outlook appears bullish, suggesting the token may be ready to extend its rally.
MKR Strength Counters Market Weakness
MKR’s price action today contradicts the bearish signals it flashed earlier. On the 4-hour chart, the altcoin had formed a bear flag, typically a continuation pattern indicating the potential for further downside.
This pattern usually begins with a sharp decline (the flagpole), followed by a brief consolidation or upward movement (the flag), before confirming a breakdown below the lower trendline.
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However, bulls invalidated the pattern instead of continuing downward by breaking above the $1,603 resistance level, with strong support holding at $1,534. This unexpected breakout indicates a change in momentum and hints at renewed bullish strength.
The Bull Bear Power (BBP) indicator supports this bullish outlook. At press time, the BBP printed consecutive green histogram bars, an early sign of strengthening bullish momentum.
The Money Flow Index (MFI) has also been climbing, indicating a steady rise in buying pressure. MKR could break through the upper resistance level at $1,901 if this momentum holds.
Reversal Gains On-Chain Support
On the on-chain front, MKR’s recent upswing has pushed its market price above the realized price of $1,609. According to data from Glassnode, this is the first time this has occurred since May 7.
For those unfamiliar with the idea, the realized price is the average on-chain cost basis and could act as support or resistance. When the market price trades below the realized price, it acts as resistance.
However, the metric has flipped into a support zone with the Maker crypto price now trading above it. If this trend holds, MKR will likely move past the psychological $2,000 region.
In line with this, the In/Out of the Money Around Price (IOMAP) indicator also supports the bullish case. The IOMAP identifies key support and resistance zones similar to the realized price.
However, it does so by analyzing the volume of tokens held in profit or at a loss. When a large cluster of addresses is profitable at a certain level, it forms a strong support zone.
On the other hand, if more holders are at a loss, that area tends to act as resistance, forming a potential sell wall. According to IntoTheBlock, the major support for MKR is between $1,672 and $1,727.
Around 1,650 addresses acquired approximately 156,740 MKR tokens at the current price range, a higher accumulation than the volume bought between $1,841 and $2,119.
This disparity suggests stronger support below and weaker resistance above. As such, it increases the likelihood that MKR could break through these upper resistance levels.
MKR Price Analysis
Looking at the daily chart setup, CCN observed that MKR’s price has broken above the upper trendline of the descending channel.
Following the move, the green line of the Supertrend has positioned below the altcoin’s value. This indicates that the trend around MKR is bullish, and the price will likely continue moving higher.
If this remains the same, the Maker crypto price might break the resistance at $2,036. If achieved, the altcoin’s next target might be $2,423.
On the contrary, rejection at the upper resistance could invalidate this forecast. If that were to happen, MKR’s price might drop to $1,409.
Disclaimer:
The information provided in this article is for informational purposes only. It is not intended to be, nor should it be construed as, financial advice. We do not make any warranties regarding the completeness, reliability, or accuracy of this information. All investments involve risk, and past performance does not guarantee future results. We recommend consulting a financial advisor before making any investment decisions.
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