Yearn Finance [YFI] Undergoes V-shaped Recovery After Hitting Local Bottom

After suffering heavy losses during the market-wide collapse, Yearn Finance [YFI] has regained the momentum that helped it breach a crucial resistance level. However, the defi token was still down by more than 33% over the last 24-hours.

The whales had aggressively bought during the dip, which pushed the prices of the coins higher. Despite the ongoing relief rally, speculations regarding the market potentially heading for a bottoming phase emerged.

Yearn Finance [YFI] surged by 13.23% over the last day to climb to a price of $46,492. At the time of writing, the digital asset registered a market cap of $1.69 billion and a 24-hour trading volume of $1.37 billion.

Yearn Finance [YFI] Daily Price Chart:

Yearn Finance [YFI] dropped sharply before undergoing a v-shaped recovery. While this abrupt price movement did help the defi token to climb above the 100 DMA [Blue], the 50 DMA [Pink], however, continued to hover above the YFI price candles, thereby resisting more upswing.

The increasing volume however backed the price of the token in the latest surge, which, if maintained, can push it higher potentially invalidating the bearish calls.

Recovery

The Yearn Finance [YFI] broke below a crucial support zone on the 23rd of May. This resulted in severe bearish pangs in the market. However, the long tail on the candlestick the very next day suggested the bulls purchased the dip which led to the recovery.

The Chaikin Money Flow [CMF] appeared to be climbing above the zero line, meaning the outflow of capital from the coin market has been on a decline.

The MACD also appeared to be resuming the buying demand as it heads for a bullish crossover. The RSI made a jump towards the 50-median line depicting a sentiment of decreasing selling pressure in the market after the formation of a local bottom.

If the price of Yearn Finance [YFI] turns down from the 100 DMA moving average of $43,665, the bears will make one more attempt to resume the downtrend. Furthermore, a break below $32,972 could open the doors for a drop to the next support at $27,251.

However, if the bulls can push the price of the defi token above $53,733, it could target other resistance levels of $72,740 and $82,889 respectively.