MKR Drops 6% After Hitting $1.8k Resistance

MKR, the governance token of the MakerDAO protocol, experienced a notable price correction after reaching a key resistance level of $1.8k. The token's price surged following Bitcoin's retaking of a crucial level, but it faced strong resistance and subsequently declined to around $1.4k. This rejection led to a roughly 6% loss in the following hours, indicating a potential shift in market sentiment.

The recent price action of MKR has been volatile, with the token witnessing a bullish signal last month followed by a setback this month. The price drop on Monday caused panic among investors, but the $1k level held firm, allowing the price to recover and bulls to regain control. However, the recent rejection at $1.8k suggests that bears may be gaining control on the hourly chart.

The long-candle wick observed yesterday indicates strong resistance from the bears, and a continuous daily loss could lead to another fresh leg down. The February low is considered a key obstacle for the bears, and if they fail to scale through it, MKR may regain momentum after undergoing a brief consolidation phase. However, the long-term outlook for MKR remains bearish.

Key support levels to watch for a potential drop include $1,200, $1,035, and $875. On the other hand, immediate resistance levels to keep in mind for a potential rally are $1,495, $1,600, and $1,798. An increase above the wicked $1,798 level could set the market up for a significant rally into the $2,000 region.

The current spot price of MKR is $1,322, with a moderate level of volatility. While the next major move for MKR looks uncertain, it is crucial for bulls to defend the monthly low to prevent further losses. If the bears fail to break through the February low, MKR may have an opportunity to regain momentum and potentially rally towards the $2,000 region. However, the long-term outlook for MKR remains bearish, and investors should exercise caution when trading this volatile asset.