The price of Uniswap has risen by about 3% in the last 24 hours, and it is currently trading at around $3.40. However, this small movement masks what really happened on February 11th. On that day, UNI surged nearly 42% to a high of about $4.57 when news connected Uniswap to BlackRock's expansion of its tokenized fund.
Since then, sellers have wiped out about 26% of this price rally. This raises an essential question: was this institutional-driven breakout a real turning point, or a trap for retail investors?
The breakout of the Uniswap price on February 11 was due to the sentiment of retail investors.
The price rally on February 11 was not a coincidence.
On the 12-hour chart, the price of Uniswap had been building a bullish setup since mid-January. Between January 19 and February 11, UNI made lower lows while the Relative Strength Index, or RSI, formed higher lows. RSI measures sentiment by tracking buying and selling strength. When the price drops but RSI rises, it signals a bullish divergence and is often a warning that selling pressure is weakening.
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This divergence indicated the building of a reversal.
The signal strengthened on February 11. On that day, On-Balance-Volume or OBV rose above a long-term downtrend line. OBV indicates whether volume is flowing into or out of an asset. When OBV breaks upward, it typically indicates increasing participation from retail investors. Timing was significant.
The RSI divergence had been ongoing for weeks. OBV only rose on February 11—just when the news related to BlackRock was published. This shows that retail investors reacted quickly to the news and rushed to buy UNI.
As sentiment and volume strengthened, the price of Uniswap rose to about $4.57 in one session. But the structure of this candle gave the first warning signs.
On the 12-hour chart, the breakout candle had a very long upper wick and a small body. This means buyers pushed the price up, but sellers absorbed most of the rise before the close. The first sign that there was strong supply around the $4.50 level. The rally appeared strong. However, the distribution had already begun.
Whale selling near $4.57 explains the sharp rejection.
The long spike on February 11 was not the result of random selling pressure. Whale data shows who was responsible for the movement.
On that day, the amount of UNI held by large Uniswap holders sharply dropped from approximately 648.46 million UNI to 642.51 million UNI. This represents a decrease of about 5.95 million tokens. At a price level of $4.57, this corresponds to approximately $27 million in selling pressure.
This was not a profit-taking by small traders, but a coordinated distribution by large wallets.
As retail investors chased the breakout, whales sold into strength. This explains why UNI's price could not hold above $4.50 and why the rally collapsed quickly. As large holders stopped selling, the buy-side sentiment weakened. Without support from whales, the markets could not sustain high prices.
The result was a rapid retracement. From a peak of $4.57, the price of Uniswap dropped about 26%. Most late buyers likely found themselves quickly at a loss. This confirms that the price spike associated with BlackRock was a liquidity event for large holders.
Demand was brought by retail investors. Supply was brought by whales.
The 4-hour chart shows that the target of the Uniswap price rally has already been achieved.
The smaller time frame explains why the correction began so quickly. On the four-hour chart, Uniswap formed a head and shoulders reversal pattern in a descending channel. This is a classic reversal pattern that often signals a short-term breakout.
On February 11, UNI rose above the neckline of this pattern and quickly reached its anticipated target level of around $4.57. Technically, the setup had already performed its so-called measured move.
At the same time, a 4-hour OBV divergence became clear. During the period from the end of January to February 11, UNI rose, but OBV continued to decline. This indicates that the strength of the volume weakened as the price rose. The downward OBV divergence warned that the breakout was not supported by continuous demand from retail investors. Additionally, OBV is now in a downtrend, indicating sell-offs by retail investors.
Retail investors focused on the price. Meanwhile, the big players concentrated on the structure. As most buyers came in, the price rally was already well underway. Now the price is moving near $3.40 while volume continues to weaken. This suggests that speculative demand is fading.
If UNI stays above the $3.21 level, the market may attempt to consolidate. However, this support level is weak because it is based on short-term buying, not long-term accumulation.
A drop below $3.21 will likely trigger a new wave of selling. At that point, the next significant support level is around $2.80, which is the peak of a previous reversal pattern. Movement into this area would eliminate all profits driven by BlackRock.
For Uniswap's price to stabilize, it must rise back to the $3.68–$3.96 range. Currently, this level is acting as a significant resistance after the failed breakout. Sustained movement above this could allow for a move towards $4.57.
