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The decentralized finance sector has posted huge gains over the past week, with all “blue chip” tokens seeing explosive momentum as the bulls pour into the hard-fought fragment of the crypto market at full speed.
This rebound first began when the YFI token of expensive DeFi Yearn.finance hit a low of $ 7,500, at which point it experienced a huge momentum that sent it skyrocketing to highs of $ 18,000.
It has since stabilized and is looking to post a high time-close above this crucial level. If firmly broken and held on for a long period of time, it could provide a base to grow on that allows it to set new all-time highs.
In tandem with the price spikes seen by many crypto tokens within the ecosystem, the returns of liquidity providers on decentralized trading platforms have also soared.
This justified the price movements seen by DeFi tokens and could create a favorable wind to lift them higher.
A trader is now noting that he expects DeFi crypto assets to go on a “stupid run” in the short term, as the rest of the market shows continued strength.
He believes the stability currently seen by Bitcoin and a massive Ethereum rally will incubate this next movement.
The stability of the crypto market helps DeFi’s rebound
The rebound seen in the larger DeFi tokens lately can be seen by looking towards the DeFi perpetual index on FTX, which tracks the value of a handful of the best projects within the industry.
This contract hit a low of $ 1,400 a couple of weeks ago and is currently trading at $ 2,160.
At its peak in late August, the DeFi index hit highs of $ 3,500. While it still has a long way to go before recovering these highs, recent lows look like a long-term low.
Analyst: DeFi tokens may soon rise
An analyst explained which believes that DeFi tokens are on the verge of skyrocketing in the short term, which will be incubated by Ethereum which will see a “stupid rush”.
“Right now there is a large market strength in the blue chips Defi, ETH and Bitcoin. Looks like ETH wants to have a stupid ride. Submit this and SNX YFI RUNE AAVE UNI go crazy to say the least, “he said.
Image Courtesy of Cantering Clark.
Ethereum’s next trend will undoubtedly affect the broader DeFi market. Any continuing force could send smaller tokens that skyrocket.
Featured image from Unsplash. Pricing data from TradingView.
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