Uniswap (UNI) Faces Sharp Bearish Pressure

Uniswap (UNI) has faced sharp bearish pressure over the past week, with the token's price declining by more than 11%.

Uniswap (UNI) has faced sharp bearish pressure over the past week, with the token’s price declining by more than 11%. However, despite this pullback, bullish sentiment within the market remains strong as Uniswap continues to dominate the decentralized exchange (DEX) landscape and shows signs of potential price recovery.

In the last 24 hours alone, UNI’s price has fallen by 7.71%. This extends a multi-day downtrend that has seen the token’s value erode consistently.

However, this downturn comes amid an overall healthy performance for the Uniswap protocol, which has seen increasing user activity, liquidity inflow, and positive developments in on-chain metrics.

Key takeaways:

* UNI price faces pressure with a 7.71% drop in the last 24 hours amid broader cryptocurrency market weakness.

* Despite this, traders remain bullish on UNI in the futures market, where long positions outweighed short ones.

* Uniswap’s Total Value Locked (TVL) increased slightly, while a key competitor, Raydium, experienced a significant drop in TVL.

* Liquidity outflows from Uniswap align with a notable drop in trading volume, signaling temporary market fatigue.

* Despite some weakness, there are positive signs for DEXs as they saw a 20% increase in engagement over the past month.

One factor in UNI’s resilience is the continued support from spot traders. While some large holders decided to take profits and exit their positions—dumping nearly one million UNI tokens, valued at around $5.73 million—retail and smaller investors stepped in to buy the dip.

In the same 24-hour period, spot buyers accumulated 2.1 million UNI, which is roughly equivalent to $12.28 million, cushioning the token from a more severe decline.

Uniswap Gains Ground Among DEXs Amid Price Setback

Even amid a short-term price decline, Uniswap has managed to advance in its role as the leading decentralized exchange. According to DeFiLlama, Uniswap’s Total Value Locked (TVL) saw a slight increase, rising from $4.924 billion to $4.959 billion, adding $35 million in value.

In contrast, a key competitor, Raydium, experienced a substantial setback with a $52 million drop in TVL over the same period.

TVL is a crucial metric used to assess the value of assets locked within a protocol, and it often reflects investor trust and user engagement. The rise in TVL suggests that more capital is being deployed into Uniswap, an indicator of long-term confidence in the platform’s utility and growth prospects.

Liquidity Outflows and Volume Decline Reflect Market Uncertainty

Despite gains in TVL, the broader picture has not been entirely favorable. Over the past few days, Uniswap has seen approximately $219 million in liquidity outflows.

This aligns with a notable drop in trading volume, which fell by more than $600 million since May 15—declining from $3.5 billion to just under $2.9 billion—according to IntoTheBlock.

This decrease in volume signals a temporary pause in trader engagement, likely triggered by overall market sentiment and macroeconomic uncertainties.

Yet, even amid this pullback, the fact that Uniswap has managed to grow its TVL and maintain trader interest reflects a deeper layer of resilience within the protocol.

Long Traders Remain Committed Despite Incurring Losses

While the market environment has remained bearish, futures traders are still betting on a potential rebound. Long positions continue to dominate short ones, evidenced by the Open Interest Weighted Funding Rate, which remains in positive territory at 0.0054%.

Though trending slightly downward, this indicator still reflects a market skewed toward bullish expectations.

Interestingly, long traders incurred significant losses in the past day—approximately $1.05 million—compared to just $25,600 lost by short traders.

This willingness to risk capital signals confidence among a segment of investors that UNI may soon stage a recovery.

Can Uniswap fuel a Rally from Here?

The answer may lie in broader ecosystem trends. Over the past month, decentralized exchanges have seen a 20% uptick in engagement, showing renewed investor interest in DEX platforms.

While activity slowed slightly over the last day, the larger trend remains positive.

If interest in decentralized finance continues to grow—and if spot buyers and developers remain active in Uniswap’s ecosystem—there’s potential for a short-term bounce and a medium-term rally.

The protocol’s solid fundamentals, including its innovation pace and market share among DEXs, serve as strong tailwinds.