Maker (MKR), the governance token behind MakerDAO, recently experienced a notable 5% dip in price—despite several seemingly bullish indicators. This decline puzzled many investors, especially considering the uptick in whale activity, increased staking, and a technical breakout on the weekly chart. So what’s really happening behind the scenes with MKR?

Following the project’s recent rebranding to SKY and the introduction of staking features, fresh capital appeared to enter the ecosystem. Two newly created wallets were spotted withdrawing and staking a combined total of 1,502 MKR tokens—valued at approximately $2.67 million at the time. These tokens were transferred from Binance and promptly locked in staking, a move that typically reflects long-term conviction rather than short-term speculation.

The staking of such a large amount of MKR from newly funded wallets is significant. It signals strong faith in the protocol’s future, likely with the intention of participating in MakerDAO governance or benefiting from anticipated price appreciation. From an economic standpoint, this act also reduces the circulating supply, introducing a scarcity effect that can, under the right conditions, support price growth.

Adding to the bullish outlook was MKR’s recent breakout above a major descending trendline on the weekly chart. This trendline had held firm since early 2024, and the breakout represents a potential shift in the long-term momentum of the asset. With MKR climbing past $1,783, analysts now see potential targets at $2,435, and further resistance zones at $3,500 and $4,099—levels not seen since the start of 2024.

However, despite these promising technical developments, the market didn’t immediately reward the move. Instead, MKR dipped 5%, accompanied by a 34% drop in trading volume. This discrepancy suggests that while long-term sentiment might be shifting, short-term traders could be taking profits or reacting cautiously to broader market conditions.

The bullish scenario remains intact as long as MKR holds above the breakout trendline. Should it fall below $1,500, the setup could be invalidated, and the asset might need to retest lower support levels near its prior downtrend. Still, the current candlestick patterns on the weekly chart show strong buying interest, with a breakout above a higher low confirming the strength of the reversal for now.

On-chain data also supports a largely optimistic view. According to IntoTheBlock, nearly 60% of MKR holders are currently “In The Money,” meaning they’re holding at a profit. This figure reflects the resilience of MKR holders and suggests there’s room for continued growth if momentum returns. The key support zone between $1,065 and $1,672 has historically shown buying interest, while resistance stretches from around $1,774 up to $5,645—areas where previous investors may look to exit.

Currently, MKR is hovering near $1,751, a level where many investors are close to break-even. A push above this threshold could signal a new round of accumulation, especially if price action begins to mimic past growth phases.

A look at the Spot Taker CVD (Cumulative Volume Delta) on CryptoQuant reveals a neutral sentiment in the spot market. Interestingly, similar neutral readings in 2021 and late 2023 were followed by steady periods of consolidation and eventual rallies. If bulls increase their pressure in the coming sessions, MKR could see a repeat of this historical pattern.

So why did MKR dip, even as whales stake and charts signal a turnaround? In short, market sentiment and short-term profit-taking appear to be outweighing long-term optimism—for now. But with on-chain data showing strong holder profitability, staking reducing supply, and technical indicators aligning for a bullish reversal, MKR may just be in a pause before its next leg upward.

For now, all eyes remain on the $1,500 support and $1,783 resistance zones. If MKR can stay above its breakout level and volume returns, the potential for a rally toward $2,435 and beyond remains firmly on the table.