Maker could be trading at $1000 soon, here’s why

Disclaimer: The information presented does not constitute financial, investment, trading, or other types of advice and is solely the writer’s opinion.

• Maker token showed short-term bearish pressure after the drop below the $1290 mark.
• There was a chance that the MKR retracement would go as low as $1037.

Maker [MKR] saw slow losses on the price chart in August that amounted to 11.64% at press time. Despite the losses in the token prices, MakerDAO itself was in a comfortable position. The recent Curve [CRV] exploit saw liquidity providers switch to MakerDAO.

Read Maker’s [MKR] Price Prediction 2023-24

However, on the daily timeframe, MKR had a strongly bullish outlook. A revisit to the $1000 support zone could offer swing traders an opportunity to enter long positions. In the meantime, scalp traders can hunt for shorting opportunities.

The 4-hour chart exhibited a bearish structure as prices continued to slump

Source: MKR/USDT on TradingView

An aggressive interpretation of the market structure would conclude that MKR’s drop below the recent higher low at $1283 on 4 August flipped the market structure bearishly. The inability to hold on to the $1270-$1300 support zone also showed bearish intent.

The RSI fell below the neutral 50 mark on 5 August on the 4-hour chart, showing a shift in momentum in favor of the sellers. However, the OBV saw only a slight move downward. This suggested that selling volume was not high, a fact reflected in the volume bars on the price chart over the past week.

To the south, the $1170 level was a support level that had been a resistance level back on 21 July. Therefore, an MKR move to the $1150-$1170 region could give a bullish reaction. The Fibonacci retracement levels (yellow) showed that the 61.8% level at $1037 had confluence with a 4-hour bullish order block. This was another region where the bulls could seize control.

The speculators leaned bearish in August as per the Open Interest chart

Source: Coinalyze

The slow descent of MKR prices from $1340 to $1210 was accompanied by a slow bleed in Open Interest. It dropped from $160 million to $110 million, showing discouraged longs. It was indicative of bearish sentiment.

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Yet, the spot CVD had halted the downtrend it began on 5 August. The flat CVD need not be followed by a rise in buying pressure, so short-term bulls must remain cautious.

Overall, the MKR token bias differed widely across higher and lower timeframes. This presented traders with multiple areas of interest in which they can look for short-term or long-term trades and would need proper planning and execution.