AAVE Drops to $200: Key Support Levels to Watch for a Possible Rebound

AAVE, a prominent decentralized finance (DeFi) protocol, faces a challenging market as it struggles to maintain the psychological support level of $200. Despite a recent buyback program, market conditions have turned bearish, with key indicators suggesting further declines.

Key Takeaways

AAVE recently attempted a price recovery but has been unable to maintain upward momentum, leading to renewed bearish control.
The increase in sell volume and a breakdown from price ranges indicate that the bullish strength is weakening at the $200 level.
AAVE’s buyback initiative, which started at $50 million, has seen significant token repurchases since May but has not been enough to counter recent market weakness.
The current trading situation shows a likelihood of a further 15% drop, with critical support levels to watch at $170 and $141.

Aave bulls to lose control of the $200 level- Here's why another 15% drop is likely

AAVE's Price Challenges and Market Conditions

Aave Taker Buy Sell Ratio The recent data from CoinGlass indicates that AAVE's 24-hour trading volume has predominantly featured taker sell orders over the past month. This trend suggests that bulls are struggling to push prices higher due to mounting selling pressure.

At the time of writing, the Long/Short Ratio stands at 0.918, reflecting a larger volume of taker sells. This signals that prices may be poised for further declines in the short term.

Breakdown of Support Levels

Aave 1-day Chart The daily chart reveals that AAVE has been on a downward trend for over a month, consistently hitting lower highs and lower lows. This price activity aligns with a bearish crossover between the 20-day and 50-day moving averages.

Additionally, the price action since May has formed a range between $221 and $336. The recent fluctuations in the market have led AAVE to drop below this range's low, establishing the $210-$225 zone as a strong resistance point.

Given the current conditions, AAVE prices appear likely to decline further. Traders should closely monitor key support levels at $170 and $141.

Disclaimer: The information in this article is for educational purposes only and does not offer financial, investment, or trading advice.