Degen (DEGEN) Price Rallies 22% Post Farcaster’s $150M Raise, Is a Breakout Looming?

• DEGEN rallies 22% in 24 hours, reaching a 7-day high of $0.02382.
• Open interest in DEGEN futures jumps 15%, signaling robust market engagement.
• Farcaster’s $150M raise boosts DEGEN, driving market cap and volume up by 22% and 80%.

Degen’s (DEGEN) price has surged in the past 24 hours after establishing support at the intra-day low of $0.01922. This surge has propelled the DEGEN price to a 7-day high of $0.02382, marking a 22% increase in the last 24 hours and 48% in the last week. Concurrently, DEGEN’s market capitalization and 24-hour trading volume surged by 22% and 80% respectively, reaching $337.77M and $67.42M.

DEGEN/USD 24-hour price chart (source: CoinMarketCap)

Farcaster’s Funding Success and Its Impact on DEGEN

The notable spike in DEGEN’s valuation coincides with the announcement that Farcaster, a blockchain-based social media platform, has successfully raised $150 million in a Series A funding round. 

The round, led by Paradigm and supported by other major firms like Andreessen Horowitz, Haun, USV, Variant, and Standard Crypto, has not only elevated the platform’s financial footing but also significantly boosted the token’s market visibility and investor confidence.

Farcaster’s founder, Dan Romero, a former Coinbase executive, highlighted that the substantial funding will bolster the platform’s longevity and scalability. Since its inception, Farcaster has registered 350,000 paid sign-ups and witnessed a 50-fold increase in network activity, underscoring a robust growth trajectory that promises to enhance the utility and adoption of DEGEN tokens.

Technological Advancements and User Engagement

In addition to financial growth, Farcaster is committed to enhancing user experience and interaction capabilities within its ecosystem. 

Romero outlined plans to introduce developer primitives to the protocol, such as channels and direct messaging, which are anticipated to enrich the platform’s functionality and attract a broader user base.

This technological push is expected to foster an environment where DEGEN tokens are not only used as a community reward mechanism but also play a pivotal role in new features and applications. The introduction of these features is set to further integrate DEGEN within the Farcaster ecosystem, potentially increasing its utility and demand.

DEGEN/USD Technical Analysis

The DEGEN/USDT trading pair has demonstrated a bullish breakout, overcoming a persistent descending triangle pattern that had formed over several weeks. The breakout, marked by a surge above key resistance levels, has shifted market sentiment from bearish to cautiously optimistic as traders and investors eye new price targets.

DEGEN/USD 4-hour price chart (source: TradingView)

The price action on the DEGEN/USDT 4-hour chart showed a descending triangle pattern from late April into mid-May, a formation often associated with a continuation of a downward trend. However, DEGEN broke out to the upside around May 16, challenging the prevailing bearish outlook. This breakout suggests a reversal and potential onset of a new bullish phase for the token.

The Relative Strength Index (RSI), however, has crossed into overbought territory with a rating of 71. This trend signals strong buying activity, although it also warns of a possible pullback or consolidation phase as buying pressure cools off.

The Average Directional Index (ADX) rating of 35.48 indicates a strengthening trend. This trend above 25 suggests that the current bullish trend is robust and likely to sustain itself. 

DEGEN Derivatives Data

Following the breakout, DEGEN has established resistance at $0.03000 and $0.03500, if the bullish rally strengthens. Adding to the bullish sentiment, open interest in DEGEN futures has surged by 15%, indicating a growing commitment from traders and suggesting that the market may be positioning for further price advances.