Maker’s (MKR) price fell 42% in August, closing the month at £636. This month-long free fall resulted in the token forming a descending wedge on a daily chart. On September 22, MKR broke out of it, and only green candles have been posted since.
More often than not, a bull run for a crypto asset starts with an upward breakout of a descending wedge. MKR’s performance on a daily chart seems to support this.
At the time of writing, MKR showed an increase in buying pressure. The Relative Strength Index (RSI) has been ascending since the bullish breakout, recovering from a prolonged decline. The RSI was recorded at 44 at the time of writing, which is still below the 50-neutral territory.
Despite being at the centre (0.1) line, the altcoin’s Chaikin Money Flow (CMF) appeared ready to go north due to sustained rise in buying pressure.
Additionally, when a bullish breakout occurred after the descending wedge, there was an upward intersection of the moving average convergence divergence (MACD) line and the trend line. This appeared to mark the beginning of a new bull cycle for the coin.
On-chain indicators issue warning signs even though price chart movements could suggest that the bulls are in charge of the MKR market.
Santiment data shows that in the previous month, the supply of MKR on exchanges increased by 7%. Increased supply on exchanges is indicative of rise in selling pressure.
From 7.61 on August 26 to -0.136 in the following 24 hours, MKR’s weighted sentiment dropped significantly as its price consistently fell throughout the month.
The metric’s value at the time of writing was -0.144. Additionally, the 30-day MVRV was 0.088%, resting on the centre line in a downtrend, indicating that few MKR holders had reported gains over the past month.