Latest Euler (EUL) Price Analysis

Deep Dive

1. Yala Stablecoin Contagion (Bearish Impact)

Overview: Euler faced indirect fallout from Yala’s $YU stablecoin, which depegged to $0.42 on 18 November due to abnormal borrowing on Euler’s platform. Euler suspended YU lending markets, freezing $YU positions and exacerbating liquidity fears (Yahoo Finance).

What this means: The incident highlighted Euler’s reliance on third-party stablecoins and operational risks in managing volatile collateral. With $YU accounting for ~5% of Euler’s TVL pre-crisis, the protocol’s reputation for risk isolation was questioned, prompting withdrawals.

What to watch: Euler’s recovery plan (due by 15 December) and audits of collateralized assets.

2. DeFi Accountability Concerns (Bearish Impact)

Overview: Recent articles criticized Euler’s permissionless vault model, linking it to systemic risks after Stream Finance’s $285M collapse (Weex).

What this means: Euler’s design allows anonymous “Risk Curators” to manage vaults with minimal oversight. As fear dominates crypto sentiment (CMC Fear & Greed Index: 25), investors are exiting platforms perceived as lacking safeguards.

What to watch: Regulatory developments or protocol upgrades addressing transparency.

3. Technical Breakdown (Bearish Impact)

Overview: EUL broke below its 7-day SMA ($4.19) and 30-day SMA ($4.68), with RSI at 35.1 signaling bearish momentum. The next support is $3.70 (November swing low).

What this means: Traders followed the bearish signal cascade, amplified by low liquidity (turnover ratio: 8.13%). Fibonacci retracement suggests resistance at $4.33 (78.6% level).

What to watch: Sustained closes above $4.05 pivot point could stabilize losses.

Conclusion

Euler’s drop reflects Yala-linked liquidity stress, sector-wide DeFi skepticism, and technical breakdowns. While the protocol’s modular design offers long-term flexibility, recent events underscore its exposure to third-party risks.

Key watch: Euler’s response to the Yala crisis and on-chain deposit/borrow ratios for signs of user confidence returning.

Deep Dive

1. Monad Ecosystem Growth (Bullish Impact)

Overview: Euler is the fifth-largest protocol by TVL ($150M) on Monad, a new Layer 1 blockchain. On December 2, Euler announced fresh incentives for its Monad markets to attract liquidity during the chain’s bootstrapping phase (The Defiant).
What this means: Incentives could drive short-term TVL growth and usage for EUL, which governs Euler’s protocol fees. Monad’s high transaction volume (16M weekly TXs vs. Arbitrum/Avalanche) adds credibility.
Watch: Whether Monad’s TVL sustains growth post-incentives.

2. Technical Rebound (Mixed Impact)

Overview: EUL’s MACD histogram turned positive (+0.166) for the first time in two weeks, signaling bullish momentum. However, price remains below critical Fibonacci resistance ($5.20 at 61.8% retracement) and the 30-day SMA ($4.77).
What this means: Traders may interpret the MACD crossover as a reversal signal, but weak RSI (40.54) and high sell pressure near $4.30 (pivot point) limit upside.
Watch: A close above $4.31 (pivot) could trigger short-term buying.

3. Broader DeFi Sentiment (Neutral Impact)

Overview: While the crypto Fear & Greed Index remains in “Fear” (27/100), DeFi TVL rose 2.5% weekly. Euler’s 24h volume spiked 10.86% to $10.15M, suggesting renewed interest.
What this means: Sector-wide stability may have reduced selling pressure, but Bitcoin dominance (58.62%) and altcoin underperformance cap gains.

Conclusion

EUL’s modest rise reflects a combination of targeted incentives and technical signals, though macro headwinds persist. The protocol’s integration into emerging chains like Monad highlights its adaptability, but sustained momentum requires stronger TVL growth and market-wide risk appetite.

Key watch: Can EUL hold above its 7-day SMA ($4.22) to confirm a bullish trend reversal?