Bitcoin is on the rise, but the rest of the crypto space is not following its lead this time. Instead, many of the DeFi darlings who led the latest bullish momentum have fallen 10% or more in the past 24 hours. What’s going on with the previously parabolic Chainlink, Yearn.Finance and Binance Coin? Here’s the good, the bad, and the ugly when it comes to these DeFi tokens and their short-term fate.
The Good: Yearn.Finance Ready to Fly if guidance can be found
Yearn.Finance is one of those magical success stories that only occasionally appear in the crypto market. The asset launched less than $ 5,000, but has since more than doubled Bitcoin’s peak price of $ 20,000.
Related reading | Binance Coin (BNB) is seeing parabolic surge as Binance Chain’s popularity grows
Today it remains much more expensive than the best cryptocurrency, and although BTC absorbed capital from the 10% YFI drop, there is currently support – both horizontally and in the middle Bollinger Band. If you hold on here, Yearn.Finance can be sent back to retest highs and then some.
Yearn.Finance Daily 10% Drop To Support & Bollinger Bands | Source: TradingView
The Bad: Binance Coin Holding Support, but Reversal Signal Storm Cloud lingers
Binance Coin appears to be in a deadlock, where bulls fight, but bears have just delivered a potentially deadly blow.
Related reading | Chainlink Monthly Finish Flashes Big Final Sell Signals
An evening star pattern may have formed at the top of the recent uptrend – which would be a strong reversal signal. However, support from Binance Coin’s February 2020 peak is currently holding up well despite the 10% intraday drop and potential rejection.
Binance Coin Daily 10% Drop To Support & Evening Star | Source: TradingView
The Ugly: Chainlink Trend is turning bearish on daily timeframes, trendline at risk
According to the Average Directional Index, Chainlink’s chances of holding out are less likely. The tool successfully flagged when LINKUSD s bullish momentum got into high gear, then again when it surprised everyone and went up even further. Now the bearish has turned and the trend is getting stronger.
Related reading | Yearn.Finance Claims Support Following Coinbase Listing, New All-Time Highs In Sight
Several supports have also been lost on the way back, and all that’s left is an upward trend that is in danger of exposing Chainlink to a deeper correction.
Chainlink Daily 10% Drop Below Support & Average Directional Index | Source: TradingView
As for the cause of the bearish selling pressure on these tokens – Chainlink, Yearn.Finance and Binance Coin – could be a number of factors. First, sentiment around the trading madness has turned extremely negative and investors could be less blinded as the bubble bursts.
Or maybe Bitcoin with USD 10,000 support led to profit taking from altcoins back to BTC. Bitcoin dominance could potentially be rock bottom, and the recent haemorrhage from these DeFi darlings could just be the start of the coming carnage.
Featured image from DepositPhotos, Charts from TradingView