Maker [MKR] Surges 60%: Sell Signal Looms

Maker [MKR] has surged by 60% this week, driven by increased demand and a shift in lower timeframe momentum. However, several factors suggest that investors should consider selling the token.

Firstly, the weekly chart of Maker displays a bearish swing structure. The price has made a lower low below the $1,000 level, which was previously tested in October 2022. Additionally, the price has reached the $1,600 region, which has acted as a resistance zone since February 2022. The 78.6% Fibonacci retracement level has also failed to provide support in recent weeks, indicating a potential continuation of the downtrend.

Moreover, the Chaikin Money Flow (CMF) indicator has been below -0.05 since August 2022, suggesting sustained capital outflows and sell pressure. The Moving Average Convergence Divergence (MACD) also indicates bearishness, although it is nearing a bullish crossover below the zero line.

On February 20, a significant amount of MKR, worth $156.77 million, was burned from an unknown wallet in eight transactions. Traders anticipated that this reduction in supply would increase the price of the token, but the burn did not initiate the expected momentum.

Data from Santiment shows that the rise in MKR prices over the past two weeks has been accompanied by heightened daily active addresses and network growth. These are bullish signals for the lending protocol, but the token is currently at a significant resistance zone. There are reasons to believe that a breakout past $1,750 could be halted over the coming days.

In conclusion, while Maker [MKR] has experienced a significant price increase this week, the bearish swing structure on the weekly chart, the lack of reaction from key support levels, and the sustained capital outflows suggest that investors should consider selling the token. Traders may want to take profits as MKR approaches the key overhead resistance and monitor the lower timeframes for signs of bullish weakness.