• Lido [LDO] posted an impressive 12% weekly return by the time of writing.
• It is heading towards a key supply zone, which may lead to another price rejection.
• A weak Bitcoin and wavering demand may complicate matters for bulls.
Analysis of Lido (LDO)
Lido [LDO] posted an impressive weekly return by the time of writing. It had rallied over 12% in the past seven days, as per CoinMarketCap. Put differently, it has reversed almost all the losses incurred in mid-May after dropping from $2.5 to $1.95.
Heading Towards a Supply Zone
Unfortunately, the price action was headed to the same bearish zone and price ceiling it encountered in mid-May. With a weak Bitcoin [BTC], >27k, sellers could regain control and extend gains to lower support levels.
Despite recent fluctuations, LDO’s market structure on the four-hour chart was on an uptrend momentum, as illustrated by the ascending channel (orange). The $2.50 – $2.77 supply zone (red) has been a critical price ceiling since late March. Besides, the supply zone could also be considered to have a bearish order block (OB) on the four-hour chart, formed on 18 March. So far, the supply zone has inflicted three price rejections since late March.
Supply & Demand
From 4 June, supply on exchanges witnessed a dip – a decline in selling pressure while outside exchanges increased – indicating short term accumulation trend for LDO with uptick in daily active addresses too demonstrating improved volume .Nevertheless ,a weak BTC alongside bearish zone above $ 2 . 5 could complicate matters for bulls .
It remains unclear whether shorting will yield gains or not but it is possible that LDO could face another price rejection at its current resistance level and if that breaks down then further falls should be expected . Therefore investors should tread carefully when considering their positions regarding this cryptocurrency .