For the time period of the past 24 hours, Lido DAO (LDO) has gone for a rise of 7.24 percent at the time of writing. The digital asset is trading at close to $0.38 and bounced back to this price level from the low of $0.3346. Daily traded volumes also moved higher on the day to $38.07 million, increasing market participation over June, which traded largely with very low volumes.
The rally presented LDO with short-term momentum but currently the token positions itself at a key level to make an important move. Buyers appear to be back in control after weeks of downward pressure and the next leg up will be if it can push over the $0.405-0.408 resistance zone.
According to the current scenario, the corresponding setup for LDO is on the mixed side but has higher momentum. The price is still well under the resistance level, which has restricted the rebounds from the market bulls in the past.
The confirmation for the breakout is missing
The most conclusive of the signals from recent activity would be found on the relative strength index (RSI) indicator, which now stands at a level of 74, well into “overbought” territory for LDO.
The momentum indicators like RSI that are overbought do not guarantee that there is any coming down to price, yet they do prove that the rate at which buyers are rushing in over time increased dramatically during the LDO’s surge, turning this into a very interesting condition given the indicator hit the zone prior to price breaking through its major resistance line.
The traders should keep an eye on this key level
For the key resistance level, LDO is currently sitting between $0.405 and $0.408, and this is the zone where the 200-day MA is also standing. This zone has turned out to be an important resistance for the market bulls on various occasions this year and this is what is making it the key level to watch.
The price was near this level in April and May, but the selling was always successful in reversing it down. If it successfully breaks the resistance at the discussed zone for the first time, that will signify a huge structure betterment and could clear the way for the price to reach $0.50.
The downside, however, is the next major support appears around $0.3346, which was the break point of the latest leg higher. There seems to be a possibility that the price may see another dip toward the $0.300 zone, where the 50-day EMA is situated.
The recovery structure will be kept intact until these support levels are respected. If the price is unable to hold that, it would trigger weakness in the current bullish momentum.
The momentum figures are on the positive side
The technical signals are still on the optimistic side for the recovery apart from the oversold figures of RSI.
The MACD stays in bullish territory and the histogram is climbing higher, indicating buying pressure behind this recent swing higher. Furthermore, volume is showing signs of strengthening through the move, providing evidence that this isn’t just a move carried by low liquidity.
This distinction is crucial as rallies with better volume stand a better chance of testing the resistance zone. Momentum is, however, never a single determining factor that depicts a trend reversal; LDO also needs to breach the 200-day EMA and stay above it as evidence of a change in the higher-term regime in favor of bulls.
The current price is at make-or-break resistance zone
This setup is the view after the recent pump that has just occurred in the market. These market bulls who bought near the $0.30-$0.34 area are already in the profits, so at resistance, they will likely take out their profits by selling the digital asset. The market participants that were betting on another decline in June most probably might be targeting the $0.405-$0.408 area.
A break above the zone could have shorts squeezed and buying will be added; a failure here would suggest new buyers should take profits. The zone is more important than just the technical area, as there is reason for both sides of the market to react there.
