Is MAKERDAO Gearing Up for a Record-Breaking Year in 2023?

18 Sep 2023 by Crypto Presale 2 min read

Despite the overall crypto market suffering from a massive selloff this year, MakerDAO (MKR) has remained unshakable, delivering excellent gains to its investors. After an enormous crash from its All-Time High in 2021, MKR found a bottom around the $490 region in late 2022. Since then, the token has tried to rebound and soar to reclaim its lost glory.

Currently trading at $1342, a 111% increase from its 2022 low, MKR looks to have risen from the dead. In the last seven days alone, the token has increased by 15%, a confirmation that the bulls are back in action. One of the key drivers behind this growth is the decision to hike the lending rate for token holders, taken in a recent governance vote. MakerDAO aims to boost demand for its $4.6 billion DAI stablecoin by introducing the Enhanced DAI Savings Rate (EDSR), potentially offering DAI holders interest rates as high as 8%. This action has boosted investor's confidence in the project and increased the demand for the DAI.

Technical Analysis

Daily Timeframe

Source: TradingView

On the daily timeframe, MakerDAO (MKR) is trading above the 50-day EMA and 200-day EMA, a confirmation that the token is currently in a strong uptrend. Also, the RSI is trending above the 50% band, which shows that the buyers are still dominant in the market. Looking at the chart, MKR is approaching a significant resistance around the $1342 region, and the sellers are doing their best to keep MKR below this zone. However, a break above this zone will see MKR soar to the next resistance level at $1,681. In contrast, if the sellers succeed in defending this zone, we might see the token fall back to around the next support level at $1000.

4 Hour Timeframe

Source: TradingView

On the 4-hour timeframe, we might experience a temporary pullback to the $1180 zone before the next leg up. As long as the MakerDAO is trading above the 50-day and 200-day EMA and the RSI is still trending above 50%, the market is still in an uptrend. Also, a pullback to the $1180 can allow more buyers to buy at a discount before the next rally.

What's Next for MKR?

Multiple factors drive the surge in MKR price. Firstly, a token buyback scheme powered by the Smart Burn Engine regularly purchases MKR using surplus DAI, reducing MKR supply and boosting its price. Secondly, MakerDAO's move into traditional investments like bank loans and government bonds for higher yields has increased investor confidence. Lastly, MakerDAO's ongoing transformation, including token upgrades and the creation of autonomous SubDAOs, is boosting investors' confidence. These combined catalysts are propelling MKR to new heights.

While technical indicators show MKR's positive momentum, these strong fundamentals are set to drive its price higher. MKR's future looks promising, backed by both technical and fundamentals.

Want more top-tier crypto market analysis?