• AAVE began the year with a strong uptrend, but a price rejection led to a 34.9% correction.
• Bears are now trying to break below the $61.4 support level, while bulls have no response to intense selling pressure.
• The futures market situation is low, with $254.37k worth of longs liquidated in total.
AAVE started 2021 off on an optimistic note with 87.5% gains in early January and mid-February, only to be rejected at the $92.6 resistance level which resulted in a 34.9% price correction over two months. As Bitcoin’s dip under $27k has provided enough boost for bears, they are now looking to break below the key support level of $61.4 while bulls have no response to intense selling pressure from bears. The futures market situation is relatively low with around $254K worth of longs being liquidated in total so far
The bearish momentum saw AAVE’s price smash through key support levels at $83.7 and $69.4 as bulls were unable to successfully defend it from bears’ attacks when retested subsequently and thus gave way to intense selling pressure resulting in two bearish candles observed on 12-hour timeframe which indicated that bears will try their best take the key support level of $61.4 and extend their gains further if successful by shorting it further towards targets at $57.5 and then eventually towards the January swing low of 51$2
If however, bulls successfully mount another defense against this downward move it would invalidate any chances of success for bears as bullish session close could signal an influx of buying pressure which could lead them reclaiming back the important resistance level of 69$.4 followed by 75$ eventually
Relative Strength Index (RSI)
The Relative Strength Index (RSI) remained under neutral 50 mark indicating lack of buying pressure while Moving Average Convergence Divergence (MACD) posted a bearish crossover; MACD line went below signal line and dipped under zero level showing that bears had upper hand in market
In conclusion, there is still much debate around whether or not AAVE will continue its current bearish trend or if bulls will be able to mount one final defense before it sinks lower past its current support levels; time will only tell as we wait for more clarity regarding this matter but until then caution should be exercised by traders regardless of what side they favor as any misstep could result in serious losses for them either way