The Aave price broke higher yesterday, leaving major resistance levels in its wake. However, this morning the rally is fading. What happens next?
Aave is trading at $363.10, down $10.07 (-2.67%)
Decentralized Finance Token Aave has been a star performer of late. Since testing key support at $212 on the 20th of July, the Aave price has gained more than 70%.
As a result, the finance protocol’s market cap had increased to almost $4.7 billion from around $2.7 billion two weeks ago.
Furthermore, the move higher has lifted the price above the 50,100 and 200-day moving averages and penetrated trend line resistance. Although, in the last 24 hours, Aave has retreated over 12% from yesterday’s $412.60 high, which may be concerning.
The daily chart shows the Aave price has made encouraging progress in recent sessions. However, today the bulls will hope to see the price close above the trend line at $377 to confirm yesterday’s breakout.
If that doesn’t materialise, it may suggest a rejection which could force the price below the 200-day moving average at $358.60. Considering the proximity of the key average, it’s clearly a possibility.
In this instance, the 100 DMA at $340 must do its job and stem the decline. A failure to do so would target $275.
However, if the price closes above $377, it should extend higher still. The daily chart doesn’t show significant resistance until the May $684 high.
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