1Inch, the governance token of the decentralized exchange with the same name, outperformed the market in the past 24 hours with its resilience to market downturns. So, is now a good time to buy 1inch?
Fundamental analysis: 1inch is a perspective new DEX
1inch is a decentralized exchange aggregator that connects several DEXes into one platform. This enables users to find the most efficient routes to swap their tokens across platforms. 1inch launched its governance token, which spelt a beginning of 1inch Network being governed by a decentralized autonomous organization (DAO). 1inch raised $2.8 million in August 2020 as companies such as Binance Labs, Galaxy Digital, Greenfield one, and Libertus Capital invested in the project. Its second fund-raising event happened in December 2020, and raised $12 million from Pantera Capital, ParaFi Capital, Blockchain Capital, Nima Capital, and Spartan Group.
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1inch’s overview looks slightly bullish, mostly because of all the well-known companies that invested in the project. It being a new and expanding project certainly added to its current market position as a cryptocurrency that’s somewhat resilient to market downturns. 1inch managed to score week-over-week gains of 27.74%. When compared to other top cryptos, it outperformed both BTC and ETH over the same period, as they posted losses of 17.22% and gains of 1.82%, respectively.
At the time of writing, 1inch is trading for $1.75, representing a month-over-month price increase of 27.78%. 1inch is currently the 114th largest cryptocurrency by market cap, boasting a value of $124 million.
Technical analysis: 1inch shows resilience to market fluctuations
1inch is currently in a healthy retracement period after it reached a high of $2.186. The cryptocurrency seems to respond well to the 4-hour 50-period EMA, which acts as its immediate support. Various analysts are calling for a long-term cup-with-handle base formation, which started with the launch of 1inch trading, with the current price direction acting out the “handle” part of the movement.
1inch faces a strong resistance zone near the 61.8% Fib retracement of $2.05, while its support is guarded by the 50-period 4-hour EMA, as well as the 78.6% Fib retracement level of $1.48.
1inch’s RSI on the daily time-frame is in a downtrend ever since the cryptocurrency created recent highs a week ago. Its value is now in the neutral part of the range, sitting at 48.31.
Zooming in to the hourly time-frame, we can better see 1inch’s short-term fluctuations. On top of that, the cryptocurrency shows a steady decrease in volume, possibly indicating an end to the downturn and a breakout of the cup-with-handle base formation.
If the cup-with-handle base pattern breakout happens, traders may expect a target price equal to the distance of the from the mid-point of the cup portion of the pattern to the recent highs.