The downward trend in crypto market has not changed in the previous week. Proof of it is the update of the DeFi composite index historical high. In fact, this trading week can be divided into two stages.
The first stage, from 17 to 20 September, the price was in the critical price range of $660-700. Buyers hopefully believed in a rebound from this range to begin the formation of a new growth trend. In the previous article we wrote about the importance of this range. However, the presence in this range of the lowest trading volumes in the index history indicated the reluctance of buyers to perform feats. Though, there were prerequisites for feats.
According to Defipulse.com, from 17 to 23 September inclusive, the total amount of locked funds in DeFi projects increased. And it was on 24 September, after Bitcoin exit from the consolidation range $10,400-10,600 down, DeFi investors began to worry:
As we can see in the chart, investors are quickly regaining confidence in DeFi projects. The same cannot be said about the DeFi tokens.
The second stage of trading began on 20 September, namely the index fаll by 30%. The break of the range $660-700 down formed a clear price falling channel. To reverse the trend of sellers, the first task is to regain control over the local point $586. If buyers confidently fix above they will be able to conquer back the main critical point – $660-700.
The DeFi composite index changes in the calculation.
Today, the Binance Exchange traditionally lists the percentage of the DeFi tokens impact on the index. Last week, the changes concerned only the redistribution of influence between the 18 tokens. This time UNI, the sensational DEX Uniswap token, was added to the index management. According to Binance, it is an important step towards the formation of a fair price DeFi composite index. This conclusion can be drawn from its weight of influence, which is 12%. In essence, this is the second most influential token after LINK.
They have reduced the weight of the impact to other tokens which are part of the index. Thus, for a month of the Defi composite index work:
-the number of tokens affecting the index has doubled
– LINK lost its influence from 28% to 15%.
Given the situation in the crypto market, it is too early to talk about positive changes in the current trend. Let’s see if DeFi projects can adapt to such conditions and continue to grow. See you next week!