Maker DAO’s MKR token has experienced a significant boost amidst a slight uptick in the broader cryptocurrency market. Despite the struggle for most tokens to recover, MKR has consolidated its upswing with an impressive 5% 24-hour increase. With MKR currently trading at $1335, it is poised to conquer the critical resistance level at $1,350. This article will explore whether the bullish momentum is strong enough to propel MKR to the $1,500 price mark.
Strong Trading Activity and Increased Buyer Interest
MKR is currently the top-gaining cryptocurrency, surpassing Chainlink and Bitcoin Cash by 2%. This comes as the overall crypto market cap records a slight uptick of 0.63%, while trading volume experiences a 4% decline, indicating a decrease in trading activity. However, MKR bucks this trend by recording a 47% increase in trading volume. This observation signals an increase in buy action within the Maker market. To better understand this surge in interest, it is vital to identify the underlying factors behind it.
The recent proposal to deploy Spark Protocol on zkSync Era Mainnet has generated significant buzz and bolstered investor sentiment. This proposal includes wETH, rETH, wstETH, and DAI as initial collaterals for borrowing on the Spark Protocol. If adopted, the proposal will set a liquidity goal of 2 million to drive Spark Protocol’s growth on zkSync. Notably, 100% of the Maker community voted in favor of launching Spark on Gnosis Chain, making DAI the native gas token of Gnosis Chain and allowing users to earn increased yield when lending their DAI tokens. This positive development within the Maker ecosystem has likely resulted in increased demand for MKR, the governance token of the Maker protocol.
Bullish Momentum and Key Support Levels
Analyzing the daily chart, it is evident that MKR has formed two consecutive bullish candlesticks around the $1,300 price level. This formation indicates high token demand and increased buying strength within this zone. Furthermore, MKR has surpassed a key support level of $1,086 and a critical moving average of $1,166. However, the bulls encountered resistance at the $1,354 mark, leading to two bearish candlesticks and hindering further upward movement. Despite this, MKR remains slightly below $1,354 since the start of the trading session at $1,338.
The Relative Strength Index (RSI) has increased from 63 to 64.97, approaching the overbought area. This rise in the RSI signals an increase in buying strength, indicating more buyers entering longer positions and ready to counter the selling pressure resisting further rally. If buyers maintain the current momentum, there is a possibility of a breakout above $1,354 and a move towards $1,500 before the end of the day.
Maker DAO’s MKR token has exhibited positive momentum in the wake of a broader cryptocurrency market uptick. With increased trading volume and buyer interest, MKR has surpassed key support levels and encountered resistance at $1,354. The proposed integration of Spark Protocol on zkSync Era Mainnet has further fueled positive sentiment within the Maker ecosystem, driving demand for MKR. As the Relative Strength Index signals rising buying strength, there is potential for a breakout and a move towards $1,500 if the current momentum is maintained.