Disclaimer: The information presented does not constitute financial, investment, trading, or other types of advice and is solely the writer’s opinion.
- AAVE climbed high after a retracement to continue the upward trend.
- Longs were in the majority on the exchange long/short ratio.
Aave’s [AAVE] 53% gains between 16 June and 5 July completely reversed the altcoin’s bearish slide. Using the $51 support level as a springboard, bulls rallied to break past the resistance at $61.4 and $69.3.
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This flipped AAVE bullish on the 12-hour timeframe, as it broke the bearish trendline and lower high. With the crypto market enjoying a bullish revival, AAVE buyers will be moderately confident of registering more gains.
Bulls finally wake up from their slumber
Source: AAVE/USDT on Trading View
The intense selling pressure on AAVE saw it record a 43.7% price drop in Q2 2023. This saw the crypto lending token sink to a year-low of $47.4. However, the bullish order block between $47.4 to $52.1, along with the critical support level, was key to AAVE’s resurgence.
Bulls rallied strongly with a significant bullish candle on 25 June, taking AAVE above the $61.4 and $69.3 resistance levels. Price retraced due to profit-taking but immediately found support on the trendline to continue the upward momentum.
With price trading at $77.4, as of press time, bulls have the $83.6 resistance level firmly in sight. A break in this resistance will offer buyers the opportunity to register a year-high for AAVE.
However, the price action on the daily timeframe showed that bears could yet halt the bullish momentum, especially if Bitcoin suffers a significant price dip.
Meanwhile, the Relative Strength Indicator’s (RSI) reading of 66 highlighted the increasing demand for AAVE as it approached the overbought zone. The Chaikin Money Flow (CMF) was also positive and stood at +0.08.
While the CMF reading was positive, it hinted that big money capital was treading cautiously.
Speculators favor a bullish continuation
Source: Coinglass
Realistic or not, here’s AAVE’s market cap in BTC terms
The four-hour exchange long/short ratio data from Coinglass showed a strong preference of market speculators for more bullish gains in the short term.
As of the time of writing, longs held a 52.62% advantage. With Bitcoin rising above 31K again, AAVE buyers can be confident of further gains in the short term.
