Why Is HIFI Pumping? Analyst Sees No Resistance Above

The price of HIFI Finance’s HIFI token has skyrocketed over the past few days, gaining 75.67% in the last week and a whopping 46.38% in just the last 24 hours. This massive pump has traders curious – what is driving the meteoric rise in this Ethereum-based lending protocol token?

Surging Korean Demand

According to analysis from Lookonchain, much of the trading volume for HIFI is coming out of Korea, specifically the Upbit exchange. Upbit accounts for over 70% of total volume, and HIFI is trading at a premium of 1.2% on Upbit compared to Binance. This localized surge in demand goes a long way towards explaining the pump.

Supply Locked on Exchanges

Lookonchain also notes that exchanges hold around 85% of the total HIFI supply right now, with Upbit alone accounting for 54% of all HIFI tokens. This means the float for active trading is quite small relative to total supply, leading to exaggerated price moves.

Few Token Holders

Additionally, the top 20 HIFI holders own 95% of the total supply. This concentration of HIFI among just a few whale wallets adds to the supply scarcity as most tokens are not freely trading. With strong demand growth against constrained supply, the price spike makes sense.

Smooth Sailing Higher?

According to analyst Qudrat Nasiri, HIFI may continue surging as there is little resistance overhead. However, Nasiri cautions that HIFI is overbought on all timeframes after this parabolic move, so a retracement towards the $0.92 level is likely before more upside.

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In summary, constrained supply and spiking demand, especially from Korea, explains the tremendous pump in HIFI recently. While more upside is possible long-term, a pullback may happen first to cool off overheated technical indicators before the next leg higher. Traders will be monitoring HIFI closely for entries on both the long and short side.

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Vignesh Karunanidhi
Vignesh Karunanidhi

Seasoned crypto writer with deep passion for blockchain and cryptocurrency