MORPHO Crypto Surges Despite Broader Market Sentiment
On February 28, MORPHO crypto experienced a significant surge of up to 20%, defying the risk-off sentiment prevalent in the broader crypto market. However, despite this impressive rally, technical indicators are now pointing towards a potential pullback for the altcoin.
MORPHO reached an intraday high of $2.44 on Friday, marking a 35% increase from its weekly low and pushing its market cap close to $500 million. This price surge was accompanied by a substantial rise in trading volume, which doubled from the previous day to over $94 million.
Established in 2021, Morpho is a decentralized, noncustodial lending platform built on the Ethereum network. The platform aims to optimize lending pools by facilitating direct peer-to-peer interactions, enabling overcollateralized lending and borrowing of crypto assets.
By matching liquidity directly and utilizing traditional lending pools as a backup, Morpho seeks to provide better interest rates for both borrowers and lenders.
Key Developments and Listings
The recent surge in MORPHO’s price was largely attributed to its listing on both the Ethereum and Base networks by Coinbase, the largest crypto exchange in the U.S. Known for its “Coinbase Effect,” the exchange’s listings have historically influenced the prices of cryptocurrencies.
Following the listing, Morpho’s developers announced updates related to their smart contracts being live on multiple blockchains, including Unichain, Mode Network, Hemi, Corn, and Sonic. These contracts have undergone independent audits and come with a $2.5 million bug bounty.
As a result of these developments, MORPHO trended on Google, indicating increased community interest and engagement.
Potential Correction and Market Analysis
Despite the positive developments and price surge, there are potential risks for MORPHO traders. Data from IntoTheBlock shows that 95% of MORPHO tokens are held by large investors, with over 87% of holders currently in profit. This could lead to profit-taking and selling pressure, especially in a bearish market environment.
Technical indicators have also turned bearish for MORPHO, with the altcoin trading below the 50-day moving average. The Supertrend indicator remains in the red and above MORPHO’s price, signaling a bearish trend.
While MORPHO is still trading above a descending trendline that has been forming since January 17, a drop below this trendline could indicate a bearish reversal, potentially leading the price towards the local low of $1.75.
However, if market sentiment improves, MORPHO could rally higher and invalidate the bearish setup. At the time of writing, MORPHO had retraced some of its gains and was trading at $2.26 per coin.