Uniswap (UNI) Falls 18% Since Recent High Questioning Bullish Outlook

Key Takeaways

• UNI faces key resistance at $8 for bullish confirmation.
• A five-wave pattern would confirm the start of a bull phase.
• Downside risks could push UNI below its August low.

UNI’s price action has seen significant volatility, rebounding from its low in August and testing key resistance levels.

This analysis explores scenarios for UNI, examining bullish and corrective patterns to provide insights into potential future price movements.

Uniswap Price Analysis

After reaching a low of $4.70 on Aug. 5, Uniswap (UNI) rebounded by 54%, climbing to $7.22 by 21. This peak hit descending resistance, leading to a reversal.

By Sept. 2, UNI established a higher low at $5.60, hovering around 0.786 Fibonacci retracement level. From this point, two scenarios are possible: the first being a bullish phase initiated on Aug. 5, aiming for a breakout above the $8 horizontal resistance to confirm a bullish outlook.

Read more: Uniswap (UNI) Price Faces Sell-off Risk as Full Supply Unlocks

However, the initial rise from Aug. 5 to 21 lacked a clear five-wave structure, suggesting that this rebound may form a lower high, potentially leading to further declines. Although UNI has recently broken above descending resistance, this could still be part of a corrective move.

If UNI‘s upward movement continues to form a new high, it will confirm the beginning of a bull phase through a five-wave pattern.

Conversely, if the price turns downward soon, a drop to the $5.50–$5.20 range would be the expected target.

From its yearly high of $17 in March, we could have seen the compilation of the WXY correction on Aug. 5. But since its following uptrend lacked a visible five-wave pattern and looks more likely a sideways move, it could be interpreted as the second wave X from the prolonged WXYXZ correction. 

In this case, UNI could start its final wave Z on the downside, as it found resistance below $8 and fell by 18%. So which is more likely? 

UNI Price Prediction

Zooming into the hourly chart and inspecting the wave structure behind the uptrend from Aug. 5, we can see that UNI could be posed for more upside.

However, the structure looks like a three-part correction with more downside upon completion.

Its last 18% decline corresponds with the 22% decline from Aug. 22 to Sept. 1, concluding the second ABC correction.

This leads us to believe there is one more ABC to the upside with a modest price potential of below $9. 

Alternatively, there is also a chance that the Sept. 28 high of $7.80 completed one ABC pattern, differently counted, in which case the 18% is only the beginning of the expected higher degree wave Z. 

In both cases, we could expect UNI to continue its higher degree correction and fall below its Aug.5 low, potentially reaching the $4 area.