UNI -16.7% in 24 Hours Amid Sharp Market Correction

UNI, the governance token of Uniswap, experienced a 16.7% decline within 24 hours on SEP 2 2025, falling to $9.683. This sharp drop marked the latest in a series of steep declines, with the token having dropped 70.59% in the past week and 56.14% over the last month. The one-year loss for the asset now exceeds 2777.32%, underscoring a prolonged bearish trend in the broader cryptocurrency market. The sell-off appears to be part of a broader correction affecting high-liquidity DeFi tokens, driven by macroeconomic pressures and shifting investor sentiment.

The recent volatility reflects heightened risk aversion in the crypto market. Despite UNI's role as a key governance token in one of the largest decentralized exchanges by volume, its price performance has not provided a buffer against the wider downturn. Analysts suggest that the lack of fresh catalysts—such as major protocol upgrades or renewed institutional interest—has contributed to the ongoing weakness in the token's valuation. A bearish outlook is further reinforced by deteriorating technical indicators, including declining on-chain activity and reduced developer activity in the Uniswap codebase.

Technical analysts have closely monitored key levels as the token continues its downward trajectory. The breakdown below critical support levels has triggered stop-loss orders and accelerated the sell-off. The 20-day EMA and 50-day EMA have both crossed below the price, signaling a deepening bearish bias. Additionally, the RSI has entered oversold territory, raising questions about the potential for near-term stabilization or further capitulation. Market participants are now looking for a potential rebound from the $8.50 level, which has historically acted as a short-term floor during prior corrections.

A backtesting strategy has been proposed to evaluate potential trade setups amid the ongoing bearish trend in UNI. The strategy is based on a moving average crossover system using the 20-day EMA and 50-day EMA, combined with RSI divergence signals. When the 20-day EMA crosses below the 50-day EMA and the RSI confirms oversold conditions, the model initiates a short position. Stop-loss and take-profit levels are calculated dynamically based on recent volatility and support/resistance levels. This approach aims to capture directional momentum during periods of strong downward bias, as seen in the current market environment.