Curve DAO Token (CRV) witnessed a notable 10% price surge in the last 24 hours, following a drop in its inflation rate to 6.35% on August 12. This decrease sparked renewed interest among investors, positioning CRV for a potential further rise. A lower inflation rate typically leads to fewer new CRV tokens entering the market, contributing to the price increase.
What’s Behind the Interest?
The anticipated reduction in token supply is expected to favorably affect CRV’s price, which has plummeted over 95% since its inception. Generally, a decrease in supply accompanied by an increase in demand results in a price hike for the asset.
On August 13, rumors about the drop in CRV’s inflation rate spurred trading activities. The token’s daily trading volume soared by 103% in the last 24 hours, reaching $244 million, marking a two-month high. This heightened trading activity underscores the market’s strong interest in the DeFi token and supports the recent double-digit price increase.
Why is Trading Volume Significant?
The surge in CRV’s trading volume over the last 24 hours signifies robust market interest, which complements the notable price rise during the same period. Additionally, CRV’s positive daily active address (DAA) deviation at the time of writing indicates a sustainable uptrend with continued demand for the altcoin.
Key Inferences for Traders
Actionable Insights:
- Monitor trading volumes closely; significant increases often precede price surges.
- Pay attention to inflation rate changes; lower rates can lead to supply reductions and potential price gains.
- Utilize the Ichimoku Cloud indicator for insights into support and resistance levels.
If CRV maintains its bullish momentum and surpasses Leadership Area B on the Ichimoku Cloud, the token could potentially reach $0.34 or even rise further to $0.44. However, a bearish market shift might drive the price below the Ichimoku Cloud, potentially dropping to $0.18.
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