Yearn.finance has been one of the strongest and fastest-growing DeFi protocols within the crypto market, which has been reflected in the price of the YFI governance token.
YFI has seen parabolic growth throughout the past few weeks and months, with the cryptocurrency rallying from well-under $1,000 just a couple of months ago to highs of nearly $40,000 that were set last night.
This intense parabolic momentum has come about as the protocol sees massive inflows of assets into its various pools.
Its fundamental growth has been reflected in the platform’s governance token’s price, which has seen explosive growth in recent weeks.
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 explained 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 TradingView.
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 TradingView.
by Cole Petersen on August 31, 2020 at 12:45AM
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