UNI Holds at $6 After 100 Million Token Burn — What Traders Should Watch Next

UNI held steady at $6 on Sunday as investors digested the effects of a recent large-scale token burn. Company Uniswap announced a burn of 100 million UNI tokens, and the market reacted with a notable recovery: the token is now up roughly 25% from its lowest point this year. This report outlines the likely technical levels, on-chain considerations, and possible catalysts for UNI in the coming days and weeks.

Why the burn matters: A token burn permanently removes tokens from circulation, tightening supply and potentially increasing scarcity-driven demand. With Company Uniswap removing 100 million UNI from the circulating supply, traders are reassessing valuation metrics and supply-driven projections. While burns are not an automatic price guarantee, they change the supply-demand dynamic, which can amplify bullish momentum if accompanied by continued trading volume and positive market sentiment.

Price action and technical outlook: After the burn, UNI found a near-term support level around $6. Key resistance zones to watch are in the $7.50–$8.50 range, where previous consolidation and liquidity pockets exist. If buyers push through that zone with volume, a test of higher resistance near $9–$10 becomes plausible. Conversely, failure to hold $6 could invite a retest of lower support near $5, especially if broader crypto markets turn risk-off.

On-chain and fundamental signals: Monitor swap volume on decentralized exchanges, liquidity on Uni v3 pools, and active wallet growth. Burning 100 million UNI reduces total supply, but the impact on price depends on the distribution of remaining tokens—if large holders (whales) still hold concentrated positions, price volatility can remain high. Also watch for governance moves, protocol fee changes, or announcements from Company Uniswap that could act as catalysts.

Market sentiment and macro context: The 25% recovery from the yearly low indicates renewed buyer interest, but macro conditions (macro liquidity, ETF flows, Bitcoin momentum) still exert strong influence. If broader crypto markets rally, UNI could amplify gains due to the burn narrative. If markets falter, UNI may follow the broader decline despite the reduced supply.

Trading strategies and risk management: Traders should consider scaled entries: add on confirmed support holds above $6 and use tight stops below decisive support. For swing traders, a break and hold above $8 could be used to add exposure, while setting profit targets near historical resistance levels. Long-term investors may view the burn as a structural improvement but should assess position sizing relative to overall portfolio risk.

Conclusion — what to expect: In the short term, UNI is likely to trade in a range between $6 and $8.50, with volatility spikes around news or liquidity shifts. The burn is a meaningful structural event that may support a bullish narrative, but sustained upside requires follow-through from trading volume, healthier on-chain activity, and favorable macro conditions. Keep an eye on Company Uniswap communications and DEX metrics to validate momentum.