UMA Surges 26.54%: Can Bulls Sustain Momentum or Is a Retrace Ahead?

UMA, the decentralized finance cryptocurrency, has captured traders’ attention with a sharp 26.54% rally from a key support zone. This bullish move has sparked interest across the crypto community as the token tested significant resistance at $1.80. The pressing question now is whether UMA can maintain its bullish structure or if a retrace to lower levels within a broader range is on the horizon.

Key Technical Insights

  • Rejection at $1.80: UMA faced resistance at $1.80, forming a rejection wick that indicates selling pressure.
  • Critical Support Zone at $1.60–$1.40: This area includes a flipped order block and the local value area high, making it a crucial level to watch.
  • Potential Upside Target: A bullish continuation could see UMA aiming for $2.55, provided support holds.

Analyzing the $1.80 Rejection

The recent rally for UMA originated from a well-defined demand zone, supported by strong confluence factors. These included prior structural support, high-volume interest, and a flipped order block that strengthened bullish momentum. However, the price stalled at $1.80, a historically significant resistance level, leading to a rejection wick. This wick suggests early signs of profit-taking and potential bearish absorption.

Following the rejection, UMA retraced into the $1.60–$1.40 region. This zone is now a critical area to determine the next directional move. If bulls can defend this support, it could pave the way for another rally. On the other hand, losing this level may result in a return to lower levels, invalidating the bullish thesis.

Why the $1.60–$1.40 Zone Matters

The $1.60–$1.40 price range is more than just psychological support. It holds significant technical importance:

  • Flipped Order Block: Previously a supply zone, this area has now turned into a demand zone.
  • Value Area High: This price level aligns with high-volume trading activity, adding weight to its significance.

For bulls to regain control, UMA must hold above this zone and begin forming higher lows. If successful, the next upside target is $2.55, a notable resistance level that could attract further attention from traders.

Risks of Breaking Support

If UMA breaks below the $1.40 level, it would likely signal a return to the origin of the recent pump. In this scenario, the rally would be categorized as a deviation within a broader range-bound market rather than a true breakout. A failure to hold support could lead to a full retrace, pushing the token back into a sideways accumulation phase.

What to Watch Next

All eyes are now on the $1.60–$1.40 support zone. Traders should monitor whether UMA can maintain this critical level. Key scenarios to consider:

  • Bullish Continuation: Holding the $1.60–$1.40 zone could lead to a rally toward $2.55, the next major resistance level.
  • Bearish Breakdown: A break below $1.40 would likely result in a pullback to retest the lows of the broader range.

The coming days will be pivotal for UMA. Whether the token maintains its bullish momentum or retraces back into accumulation will depend heavily on how it interacts with the $1.60–$1.40 zone. Keep an eye on volume and price action for further clues on the next move.

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