DeFi Composite Index Train Gains Momentum and Aims for $1156
After a protracted correction that lasted from 24 November, the celebration of life in the DeFi composite index market continued.
A strong price sellers’ bastion $700-740 was conquered on 3 January. Breaking the critical range and the price growth continuation was at increased volumes, which eliminates the possibility of false breakout.
In fact, the latest attack by sellers on 23 December was the starting point for a new wave of growth. During the previous 7 trading days, buyers managed to raise the price of the index by 40% and return the lost trend line.
The target of our previous article is fulfilled; buyers tested the mark of $900. Though, it is obvious to the naked eye that the price is not going to stop. Buyers systematically buy, not allowing the price to start even a small correction:
Growth continuation seems a possibility
The chart shows a historically important price zone of $850-900, from which a powerful wave of fall began on 12 September. Fixing the price in this price zone will confirm the great ambitions of buyers and will continue the uncorrected price growth at least to $1050-1090.
Given the love of the cryptocurrency market to Fibonacci levels, it is worth mention the proportions of the latest index price correction. The fall wave from 24 November corrected the previous growth wave by 61.8%.
The new growth wave in proportions is already equal to the growth wave in the period from 5 to 24 November. Given that there are no hints at correction in the market – the probability of continued growth with the final target of $1156 is quite high.
An alternative scenario for the DeFi composite index is to fall to the range of $700-750. However, this will only be a good chance to buy those investors who did not have time.
Analysis of tokens included in the DeFi composite index
This week we were pleasantly surprised by two tokens: LRC and MKR. Showing an increase by almost 300%, the LRC token underwent a baptism by fire as the index member.
Thus, we could expect anything from the young, hot and without trading history LRC. The token of the Maker Dao project was a real shock. With an average volatility of 10% per week, the token for two weeks showed growth of more than 100%:
LINK also added a significant positive contribution to the bowl of success, growing by 50% in a week. This week erased all limits between the index outsiders and its titans, who bravely held the price in difficult times.
Great start to the year. Let’s see how quickly buyers will be able to test new targets and update the DeFi composite index historical high.
Peter is a crypto analyst who after getting acquainted with the cryptocurrency market in 2017, immediately transferred it to the friend zone. Peter's passion is analysis and forecasting of the cryptocurrency market, including the DeFi space. In his articles you will find accuracy and prudence.
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