Why could UNI face a correction?

• Uniswap price hovers around $5.92 on Thursday after rallying 12.8% so far this week.
• According to Wu Blockchain, data shows the address transferred 9 million UNI to the Coinbase Prime Deposit on Thursday.
• Traders should exercise caution, as such transfers could trigger volatility in UNI.

Uniswap (UNI) price hovers around $5.92 at the time of writing on Thursday, having rallied 12.8% so far this week. According to Wu Blockchain, data shows that the address potentially related to the Uniswap team, investor, or advisor transferred 9 million UNI to the Coinbase Prime Deposit on Thursday. Traders should exercise caution, as such transfers could trigger volatility in UNI.

Uniswap whale wallet moves nearly $54 million

Wu Blockchain’s X post on Thursday indicates that an address potentially associated with the Uniswap team, investor, or advisor transferred 9 million UNI worth $53.91 million to the Coinbase Prime Deposit on the same day. 

According to CoinGecko data, this token transfer represents approximately 1.5% of the current circulating supply of 600 million. 

Uniswap chart. Source: CoinGecko

If this move signals an intent to liquidate or stake UNI, as Coinbase Prime often facilitates large-scale trading or custody for institutions, it could trigger volatility in UNI and generally lead to a short-term correction in the Uniswap price. Therefore, traders should exercise caution regarding this move.

Uniswap’s technical outlook shows resistance around its 50-day EMA

Uniswap price retested and found support around its August 5 low of $4.70 on April 9, and it has recovered nearly 27% in the last two weeks. However, at the time of writing on Tuesday, it faces resistance around its 50-day Exponential Moving Average at around $6.28 and is declining slightly.

If the 50-day EMA continues to hold as resistance, UNI could extend the decline to retest its next support level at $5.52. A successful close below this could extend an additional decline to test its August 5 low of $4.70.

The Relative Strength Index (RSI) on the daily chart reads 53, just above its neutral level of 50, and points downwards, indicating a fading of bullish momentum. However, if the RSI slips below its neutral level, it suggests a rise in bearish momentum and a sharp decline in Uniswap price.

UNI/USDT daily chart

Conversely, if UNI breaks and closes above its 50-day EMA at $6.28, it could extend the rally to retest its psychologically important level of $7.