Grayscale Fund Announcement Sparks Maker (MKR) Price Rally But Breakout at $2,150 Remains Elusive

Key Takeaways

• Grayscale announced a Maker (MKR) investment fund on Aug. 14.
• MKR’s price is currently capped by the key resistance level at $2,150
• Can MKR break out from this resistance, or will it get rejected instead?

Maker’s MKR token has surged 25% from its recent low on Aug. 5, buoyed by the announcement of a new Grayscale fund.

However, the rally has stalled at a critical resistance level, leaving investors wondering if MKR can break through the $2,150 barrier and continue its upward momentum.

Grayscale Adds Maker

On Aug. 14, 2024, Grayscale announced  it would offer its investors a new single-asset crypto fund that contains MKR. Grayscale stated  that the fund launch will expose investors to the entire Maker ecosystem.

The Grayscale MKR trust  manages $226,904, and its Net Asset Value (NAV) per share is $12.77.

In other positive news, the DeFi Education Fund announced  the purchase of a patent related to Oracle technology from True Return Systems.

They will dedicate it to the public, ending a lawsuit against Maker and ensuring that similar lawsuits cannot be filed in the future.

Can MKR Reclaim Resistance?

The daily chart shows that Maker has fallen since its yearly high of $4,075 in April. At first, the price bounced at the $2,150 support area (white circle), temporarily ending the decline.

However, after creating a lower high (black icon), it plunged quickly and broke down from the area on Aug. 5. The decline led to a low of $1,720.

After the breakdown, bulls stepped in and pushed the MKR price higher, taking it back to the $2,150 area. Whether it breaks out or gets rejected is important for the future Maker trend since it will determine if this is a retest or a rejection.

Unfortunately, the RSI and MACD do not help confirm, which is more likely since both give mixed signs. While the RSI is increasing, it is below 50. Similarly, the MACD is close to making a bullish cross but is deep into negative territory.

So, to establish whether the trend is bullish or bearish, we need to look at a longer time frame and wave count.

Long-Term MKR Bullish Trend Intact

Raking a step back to assess the broader market context, the technical outlook for MKR appears increasingly bullish.

A closer examination of the wave count suggests that a five-wave upward trend is unfolding, with the recent low on August 5 marking the completion of wave four.

Notably, this bounce occurred precisely at the 0.618 Fibonacci retracement support level, reinforcing the validity of the support trend line within the descending parallel channel.

In this case, the 1.61 external Fibonacci retracement of wave four will create the target for wave five. The Fibonacci method predicts a high of $5,525, very close to the all-time high price of $6,391.