One of the best performers of the month, Lido DAO, exceeded expectations in terms of price recovery. Well, thanks to the wild volatility the altcoin faces.
Unfortunately, the upward movement of LDOs can eventually stop. And, in the coming days, LDO holders may see a decline in their portfolio.
Lido DAO to go back?
Well, a merger is definitely on the cards, should LDO avoid going under.
The reason behind this is not speculation or a bearish stance. But it is the saturation of buying pressure that has been responsible for the rally so far.
Indeed, two weeks ago, LDO was in a 10-day consolidation period after peaking in the overbought zone.
As evidenced by the Relative Strength Index (RSI), a similar incident took place last week. And, LDO dropped almost 15%, only to recover it all in the previous 24 hours of press. Thus bringing the rally to 483.07%.
Now, once again, the index is heading into the overbought zone. Given historical indications, a trend reversal will soon be underway.
Lido DAO price action | Source: TradingView – AMBCrypto
Notably, some investors expected this, which is why in the last 20 days, over $25.8 million worth of LDO was sold on exchanges.
However, LDO holders need not worry about a trend reversal as the altcoin is in a safe place.
Lido DAO sales from investors | Source: Santiment – AMBCrypto
Even if prices correct slightly, investors will HOLD their bid until the recovery hits, as their trades over the past two months have been overprofitable. Something they wouldn’t want to lose by selling at a lower price.
Additionally, at one point in the month, over $40.38 million worth of LDO trades netted investors profits.
Lido DAO trades in profit | Source: Santiment – AMBCrypto
But beyond the profits, LDO will also find support from external factors such as the arrival of The Merge on Ethereum (expected between August 6th and August 12th).
After the final merger of the testnet, Goerli/Prater, which will take place on August 4th, Ethereum will welcome Proof of Stake. Thus, inadvertently benefiting LDO.
The final testnet merge is planned pic.twitter.com/l4hjeWVIPa
— Cobie (@cobie) July 28, 2022
