Pendle Price Targets Breakout Above $2.35 Resistance as New Staking Model Launches

Pendle's price is showing promising signs of recovery as it surpasses a significant resistance level, aided by its introduction of a new staking model.

Key Takeaways

Pendle's price is up 9% to $2.07, showing recovery post an initial decline.
New staking model launching involves a shift from vePENDLE to liquid sPENDLE.
Increased trading volume and open interest suggest confidence in price movements.
Technical indicators point to potential upward momentum, with key resistance at $2.35.
Ongoing price movements will hinge on sustained performance above $1.95 or breakthroughs above $2.35.

By understanding these developments, beginners in cryptocurrency can gain insights into Pendle’s potential and the dynamics at play within the market.

Chart showing Pendle price consolidating

At the time of writing, Pendle is trading at $2.07, reflecting a 9% increase over the past 24 hours. This surge is supported by a rise in open interest and a comprehensive revamp of its tokenomics, making the $2.35 resistance level a focal point once again. The token has fluctuated within a seven-day price range of $1.86 to $2.31, marking a decline of 2.9% over the week but remaining up by 9% over the last 30 days. This indicates a steady recovery following last month’s downturn.

Notably, trading activity has increased alongside the price rise. Pendle’s 24-hour trading volume surged by 34% to reach $63 million, suggesting enhanced market participation rather than minimal, low-liquidity gains. According to derivatives data from CoinGlass, while the volume for derivatives trading decreased by approximately 9% to $67 million, open interest grew by nearly 10% to $45 million. This combination indicates that traders are likely opening new positions rather than closing existing ones, showing increased confidence in the current uptrend.

Factors Driving the Recent Surge

The current rally is primarily fueled by Pendle's major update to its staking and governance model. On January 20, Pendle announced the transition from vePENDLE to sPENDLE—a new liquid staking token aimed at eliminating lengthy lock-up periods. The new sPENDLE will offer a 14-day withdrawal window, with an optional instant redemption at a fee.

Under the revised system, the protocol's revenue will be allocated for PENDLE buybacks to benefit eligible sPENDLE holders. Additionally, the existing manual gauge voting process will be replaced by an algorithmic emissions model, which Pendle claims will reduce token emissions by roughly 30% and enhance capital efficiency.

Existing holders of vePENDLE will receive a boosted sPENDLE balance of up to 4x, contingent on the duration remaining on their locks. This adjustment will take effect following a snapshot scheduled for January 29, at which point new vePENDLE locks will be paused. Pendle asserts that these changes will resolve longstanding issues associated with vePENDLE, including low user participation, capital inefficiencies, and a complex weekly voting system that primarily served a limited group of experienced users.

Technical Analysis of Pendle Price

From a technical perspective, Pendle is currently experiencing broader consolidation following a previous sharp decline. The price has established a base above the $2.00 mark, supported by consistent buy-the-dip actions suggesting positive short-term trends.

Pendle daily chart. Credit: crypto.news

Simultaneously, the token is aiming to maintain its position above the 20-day moving average, a level that previously limited gains during the latest downturn. As the Bollinger Bands continue to tighten, this may indicate forthcoming price volatility and potentially a more significant movement ahead.

Momentum indicators are also stabilizing, with the relative strength index recovering from oversold conditions, currently resting near the neutral zone of 45-50. An index move above 50 could further bolster the bullish sentiment surrounding Pendle.

The area between $2.30 and $2.35 is critical, as it has consistently thwarted recent upward attempts. If the daily close surpasses this tier, it could signal a shift in momentum toward the $2.60 mark. Conversely, if Pendle stays below $1.95 for an extended period, the chances of recovery diminish, indicating that sellers might regain control. Until a decisive break occurs either way, Pendle is likely to continue oscillating within its current range.