- A very strong rejection is faced by bears on the daily frame.
- AAVE’s Price is both above the 50 DMA and 200 DMA; is this the right time to buy?
Aave is a prominent Decentralized Finance (DeFi) lending protocol built on the Ethereum blockchain. It allows users to participate in lending and borrowing activities within the DeFi ecosystem. One of its key advantages is the absence of additional costs, making it convenient for loan lenders.
The loans offered by Aave are granted in stablecoins, which are cryptocurrencies pegged to the value of a stable asset, typically the US Dollar. For example, DAI is a stablecoin that maintains a stable value of $1. By using stablecoins as the loan currency, Aave ensures that the loan price remains unaffected by the highly volatile cryptocurrency markets, providing a more stable and predictable borrowing experience for users.
AAVE’s Price Levels and Predictions
After experiencing a crash following the FTX news, the price of AAVE rose significantly in February, surging from an average of $52 to an average price of $85, representing a 63% gain in just one month. The coin then consolidated between $77 and $94 until March, when it experienced a sudden drop to $63. While the price recovered from that point, it didn’t come close to the average price of February 23rd.
Since the breakdown of support, AAVE was in a downtrend until June, when it found support around the level of January 23rd, and a bullish trend emerged as the price moved above the 50-day moving average (DMA). Currently, the bulls appear to be taking control, as the price has even broken above the 200 DMA. The trend is looking confident in terms of a potential takeover.
As of now, there is a consolidation zone between an immediate support at $68.96 and a resistance at $83.60.
The price of AAVE is showing significant patterns of support and resistance. The second support level at $49.09 has been confirmed twice in the past, once during the start of January when the price began rising, and the second time on June 23rd when the bearish trend reversed into the current uptrend.
Similarly, a stronger resistance level is being established at $92.32, which was confirmed during the consolidation period in February 2023 after the coin entered a bullish trend.
The Relative Strength Index (RSI) at 53 indicates consolidation, suggesting a period of stability. However, the price is exhibiting strength as the bulls have been growing stronger in recent weeks. A sudden spike in buying volume in June has not been countered by bears, indicating a potential resurgence of bullish sentiment.
Currently, the price is bouncing off the immediate support level of $68, and several green candles are instilling hope that the price might reach the resistance level of $88. As AAVE’s price is in the initial phase of a trend reversal, the probability of a breakout is high.
Conclusion:
Aave, as a DeFi lending application on the Ethereum blockchain, utilizes its token AAVE. The current price prediction for AAVE indicates the possibility of a bullish trend continuation if the immediate resistance level at $83 is broken.
Breaking the $83 resistance level could lead to further upward movement in the price of AAVE, potentially extending the current bullish trend. However, as with all price predictions, market conditions can be highly unpredictable, and investors should exercise caution and conduct thorough research before making any trading decisions.
Technical Levels
Resistance levels: $88.5 and $92.3
Support levels: $68.9 and $49.1
