Analysts are noting that from a technical perspective, it appears that YFI is forming a local top, which may mean that some further downside is imminent following the massive overnight surge.
Yearn.finance Rallies to $40,000 Overnight
Yearn.finance is currently one of the largest decentralized finance protocols in the market, with the total value locked (TVL) within the platform rapidly approaching $1 billion.
The massive inflows of capital into the various pools supported by the protocol have driven this growth, with Yearn rapidly becoming the protocol of choice for so-called “yield farmers.” One byproduct of this growth has been a parabolic rise in the price of the YFI governance token – which reached towards $40,000 overnight during an explosive parabolic upswing. At the time of writing, YFI is trading up over 8% at its current price of $29,700. This marks a massive surge from weekly lows of under $12,000 that were set just a few days ago. The dip to these lows came about after it had surged to highs of $17,000 a couple of weeks ago. This decline proved to be fleeting, however, as YFI garnered massive momentum throughout the past few days that sent it surging up to highs of $40,000 overnight, which is where its uptrend lost its momentum. From this point, the crypto slid to lows of $26,000 before it surged to highs of $32,500. It has since stabilized around its current price levels.YFI May Be Forming a Local Top: Analyst
One analyst explained that the Yearn.finance governance token may be forming a local top due to the rejection at just below $40,000.
To support this notion, he that this decline had pushed it below its 20-day moving average.“YFI 1 hour looks like local top is in, note the MA 20 violation.”
Image Courtesy of Cheds. Chart via .Although YFI’s uptrend may be a bit overheated in the short-term, its mounting dominance over the aggregated DeFi sector suggests that it has significant room for growth in the mid-term.
Featured image from Unsplash. Charts and pricing data from .