Yearn.finance’s governance token – YFI – has been subjected to immense turbulence throughout the past few days and weeks, with its recent capitulatory downturn resulting in a sharp rebound that sent its price up 50% from its lows.
The intensity of this movement has been great, potentially marking its recent lows as a long-term bottom.
The price turbulence is emblematic of degrading sentiment within the community. The exit of a key member coupled with growing animosity towards the Yearn founder has caused many investors to jump ship.
The ecosystem itself, however, remains incredibly strong, and its recent selloff may have brought it down into heavily oversold territory as a result of an emotional and knee-jerk reaction from sellers.
One analyst is now noting that serious upside could be imminent for YFI due to its ability to reclaim the support that was lost within the $15,000 region.
He believes that a sustained bout of trading above this level could be all that is needed for the token to further extend its uptrend and see significantly further gains in the days and weeks ahead.
Yearn.finance Shows Signs of Strength as Price Rallies 50% From Recent Lows
At the time of writing, Yearn.finance is trading up over 11% at its current price of $18,300. This marks a massive surge from recent lows of $12,000 that were set exactly one day ago.
The recent decline has come about due to the confluence of multiple separate factors, including mounting animosity towards the project’s founder due to losses incurred by those who minted tokens from the incomplete Eminence smart contract.
Other factors include weakness throughout the aggregated DeFi sector and the exit of a prominent figure from the YFI community.
Analyst: YFI Price Likely to Continue Higher as Long as Bulls Defend Key Level
While speaking about the Yearn.finance token’s current outlook, one analyst explained that he is watching closely for a move up higher in the near-term.
He notes that YFI’s trend is firmly favoring bulls at the moment, so long as it continues holding above $15,600.
“The price action has been so clear on the 4-hr chart. Perfect opportunity to buy support in the $12k and then the break and reclaim of $15,600. Will continue to ride this up as long as this level holds,” he stated.
Image Courtesy of Josh Rager. Chart via TradingView.
If YFI pushes higher, it could also create a tailwind that lifts the entire DeFi sector higher as well.
Featured image from Unsplash. Charts from TradingView.