The market recovery process has been going on for almost 2 weeks in the DeFi ecosystem. After the tragic events of 19 May, when all projects unanimously began a powerful fall wave, investors have noticeably calmed down.
The most interesting thing is that this is about both small DeFi projects and top ones. Today we will talk about one of the popular Compound projects.
The fact that COMP is one of the three largest DeFi projects according to Defipulse did not help it keep the price in mid-May. After setting a historical high of $911, the COMP price went to a sharp 70% correction. It took sellers only 11 days for this action.
The main loss during this correction is considered to be the range of $540-580. If we analyze the daily timeframe, we can see at what price buyers were given this range:
The COMP Price Returned to Global Consolidation
For 3 months, buyers gathered strength in a broad consolidation in order to take control of this range. However, during the first attack of sellers, buyers surrendered.
Thus, the COMPUSDT price again came into broad consolidation in the range of $345-580. On 24 and 29 May, sellers failed to fix below the lower limit of consolidation.
This fact significantly increases the probability of continuing the local initiative of buyers and the test in the range of $540-580. Though, given the trading volumes, which have been very low in recent days, this local growth wave may last a long time.
If we pay attention to the 4-hour timeframe, we can highlight a few important points on the COMP chart:
The main support for the local growth trend of buyers is a black trend line, which buyers have twice defended. Having lost control over this trend line, the COMP price will again go for a test of $345.
Although at the moment we do not see large sellers below the range of $540-580 in the COMP market. This means that even with such low volumes, buyers should still be able to test this range.
The main question is how strong will be the new fall wave after buyers reach the range of $540-580.
To Continue to Grow, Buyers Cannot Lose mark of $400
If we look at the COMPBTC chart, we see that the price has been moving within the global wedge for six months:
Buyers managed to keep the bottom trend line of this wedge and this is a good sign for another growth wave. Nevertheless, given the nature and volume of growth – this wave will be the last before the start of a protracted correction in the COMP market.