What's Driving Lido DAO's [LDO] Surge While the Market Continues to See Red?

The cryptocurrency market has recently witnessed considerable declines, with Bitcoin [BTC] dropping 7.68% to $60,782. The massive drop in BTC has caused most

The cryptocurrency market has seen significant drops recently, with Bitcoin [BTC] falling 7.68% to $60,782. This large decrease has caused most altcoins to incur substantial losses.

However, Lido DAO [LDO] has seen strong gains, with a 5.64% increase over seven days. At press time, LDO was trading at $2.39, showing a 0.54% rise in 24 hrs.

At the same time, LDO saw a 26.75% increase in trading volume, reaching $190M.

LDO’s surge has left many wondering what is driving these gains as the market continues to see red.

What is driving LDO’s surge?

Several factors have contributed to LDO’s ability to buck the market trend and continue to see gains. For one, with the development of ETH 2.0 staking,

LDO continues to offer services that allow users to stake their Ethereum [ETH] tokens without having to run their own validator nodes.

This unique aspect of ETH has led to increased staking activities, which contributes to the trading volume of Lido DAO.

Additionally, partnerships with key DeFi platforms that support staked assets as collateral, such as Mellow Finance, have played a significant role in Lido DAO’s market resilience.

Coinbase International Exchange also announced on their X (formerly Twitter) page,

“@coinbaseibtEtch will add support for atlayer, Lido Dao, and Pendle perpetual futures on coinbase international exchange and coinbase advanced…. the markets will begin on 9.30 pm 27 June.”

These developments, partnerships, and integrations have been crucial in enhancing the utility of Lido DAO and expanding its ecosystem, which contributes to its current resilience.

LDO’s market outlook and sentiment

DeFi adoption, partnerships, and collaborations have had a strong impact on LDO’s market sentiment.

An analysis of Coinglass by AMBCypto showed that the trading volume of Lido DAO has increased over the last seven days, moving from a low of $108M to a high of $147M.

This surge in volume indicated a higher interest in buying the asset and a confidence in its performance.

Source: Coinglass

Additionally, the RSI of LDO showed sustained upward movements, increasing from 46 to 57 over the last seven days.

The RSI indicated an increase in buying pressure, which, combined with bullish market sentiment, led to higher prices as seen on the daily and weekly charts.

Source: TradingView

Finally, the Chaikin Money Flow (CMF) of LDO was positive at 0.12, indicating that buying pressure was dominant at press time, which was a bullish signal.

Combined with the high trading volume, the CMF showed that Lido DAO was in an accumulation phase, which was driving prices up and likely to continue.

Source: Tradingview

An analysis of Santiment showed that the Open Interest of Lido DAO surged massively. In the last seven days, LDO saw a rise in Open Interest from a low of $51M to a high of $68M.

This increase in Open Interest indicated that buyers were opening new positions and holding onto existing positions, hoping to sell at a higher price in the future.

Realistic or not, here’s LDO’s market cap in BTC’s terms

Hence, the market sentiment remained bullish, with long holders accumulating to sell in profit.

Source: Santiment

With the bullish momentum continuing, LDO could attempt to retest its resistance level at around $2.624. However, if the market experiences a correction, the token could decline to the crucial support level of around $2.048.

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