AAVE price has staged a strong comeback in the past few days as investors buy the cryptocurrencies dip. The token is trading at $73.46, which is the highest it has been since June 25th of this year. It has risen by about 40% from the lowest point this month.
AAVE is one of the biggest players in DeFi. It is a platform that allows people to borrow money in a decentralized manner. It has also become a popular place for people seeking a good return on their investments.
Like all DeFi platforms, AAVE has been going through major challenges in the past few months. The main issue is that the collapse of products like Anchor Protocol led many people to pull their money from AAVE and other DeFi companies.
As a result, all versions of Aave have seen their total value locked (TVL) drop to just $6.7 billion. At its peak, the network had over $15 billion in assets. Recently, the price of its governance token has jumped sharply in line with the performance of other cryptocurrencies. For example, Bitcoin has surged to $22,000 from the YTD low of over $17,000.
On the 4H chart, we see that the Aave price has made a strong rebound in the past few days. It has formed a cup and handle pattern that is shown in black. In technical analysis, this pattern is usually a bullish sign.
Another bullish sign is the fact that the coin’s 25-day and 50-day moving averages (MA) have made a bullish crossover pattern. Further, the Relative Strength Index (RSI) has continued rallying and is now above the overbought level.
Therefore, Aave will likely continue rising as bulls target the key resistance point at $107. This price is about 45% above the current level and is along the 78.6% Fibonacci retracement point. As the cup forms its handle section, a short pullback could happen before that. A drop below the support at $60 will invalidate the bullish view.
This post was last modified on Jul 08, 2022, 09:23 BST 09:23