Aave Below Its Long Term Support; What To Expect Now?
Aave has been on a downtrend since April amidst intense volatility in the market. Major altcoins have extended losses owing to a major sell off all across the cryptocurrency industry. Over the past week, the coin presented lower lows and displayed intense selling pressure.
The altcoin has also experienced high trading volumes which was tied with increased selling pressure. This has also added to the falling market value of the asset on the one day chart.
Fall from the current price level would mean Aave could soon eye the support region of $50. Aave has been among the top losers in the industry with a loss of over 51% in the past one week.
Aave Price Analysis: One Day Chart
Aave was priced at $74 on the one day chart | Source: AAVEUSD on TradingView
Aave was priced at $74.80 at the time of writing. The altcoin traded at this price level a year ago in January. The downtrend for Aave seems strong because the altcoin just broke below its long standing support line of over a year.
Chances of a price reversal cannot be ruled out yet because the altcoin has broken below its descending trendline. Often after a sharp fall, prices make a turn around. In case of a price revival, Aave could target $111.
Another fall from its present price level would make the altcoin trade near the $61 support line and then hover around the range of $50. As mentioned above, the trading volume rose and was seen in red signifying bearishness in the market.
Aave registered sharp sell-off on the one day chart | Source: AAVEUSD on TradingView
Aave was in middle of a sharp sell-off, the coin hadn’t registered the same selling pressure in the last one year. This reading shows excessive bearish pressure in the market. On the Relative Strength Index, the indicator stood close to the 20-mark, this meant oversold condition for the coin.
Aave last hovered at this point in the month of December 2020. Bollinger Bands that display volatility showed chances of volatility. The bands expanded which are an indication of increased price volatility.
Related Reading | TA: Bitcoin Breaks $30K, Why This Could Turn Into Larger Downtrend
Aave displayed bearish momentum on the one day chart | Source: AAVEUSD on TradingView
Awesome Oscillator depicts the price momentum of the market. On the one day chart, the indicator was seen below the half-line. It displayed amplified red signal bars which was a sign of bearish price action. Only in the case of buyers resurfacing can Aave try to display recovery on charts.
The chances of revival over the immediate trading sessions seem weak as strength from the broader market is required. Chaikin Money Flow displays capital outflows and inflows.
On the chart, the indicator was seen below the half-line and it continued to move southbound as capital outflows exceeded capital inflows.
Related Reading | Bitcoin Exchange Inflows Hit Three-Month High As Market Braces For More Downside
Featured image from UnSplash, chart from TradingView.com