AAVE price has been depreciating with the effect of the ‘falling wedge formation’ for more than the last two months. The altcoin managed to recover from the combined support trendline of $50 on June 19, triggering a new ‘bullish cycle’ within the pattern. AAVE is trying to break the general resistance trendline with the upcoming bull run.
Key Points
- The AAVE price rose 22.5% in just two days.
- A break of the descending wedge formation could push AAVE price higher towards $260.
- Intraday trading volume on AAVE/USD stands at $213M, an increase of 15%.
The technical chart of the AAVE/USDT pair shows a support trendline that has restrained the oversold from traders since mid-December 2021. However, the chart also continues to show a bearish resistance trendline carrying the last April-May drop.
Price action within these two trend lines means the formation of a falling wedge pattern. In addition, AAVE price gradually narrowing within this bullish trend may soon present a bullish trade.
During the selling pressure experienced in the second week of June, AAVE price dropped to the lower trendline to renew the bullish momentum. Following this move, the altcoin rallied 12% and recovered from the support trendline with a morning star candle.
Continuous buying could push the AAVE price 18% higher to re-force the overall trendline. Also, under a strong bullish scenario, the altcoin could break the overall trendline and offer a 271% gain opportunity to altcoin holders.
In any case, the price will continue the downward spiral until buyers cross the resistance trendline.
AAVE Technical Indicator
A bullish divergence in the MACD indicator despite a falling price increases the likelihood of a breakout from the wedge pattern. Fast and slow lines approaching a positive transition support the current reversal.
Traditional pivot levels aligned with some chart levels increase their weight as support or resistance. These levels are $16.2 paired with pivot level S2, $70-65 paired with S1 and $115 paired with pivot(P).
Resistance levels: $70 and $115
Support levels: $49.8 and $27.4
You can follow the current price action here.
Disclaimer: What is written here is not investment advice. Cryptocurrency investments are high-risk investments. Every investment decision is under the individual’s own responsibility. Finally, Koinfinans and the author of this content cannot be held responsible for personal investment decisions.