AAVE Analysis: Navigating the Bearish Storm with Caution
AAVE continues to test our patience as it grinds through a challenging period, trading at $240.77 on October 16th. Yesterday’s bearish momentum has extended into today, with the token struggling beneath all major moving averages across every timeframe we monitor. The DEMA structure tells a clear story—downtrend dominance from the 2-hour chart all the way out to the weekly perspective.
What we predicted yesterday about continued weakness has materialized, though the intensity surprised us. The 4-hour chart shows AAVE below its 70 DEMA at $245.95, while the 6-hour has it under $250.68. These aren’t just numbers—they’re the battlegrounds where bulls and bears are fighting for control. Our analysis showed these levels would be critical, and today’s price action confirms their importance.
However, beneath the bearish surface, something interesting is brewing. The Chaikin Money Flow indicator is flashing green on the 6-hour, 12-hour, and daily charts, suggesting that smart money might be accumulating during this weakness. We’ve seen this pattern before—institutions buying while retail panics. The Stochastic RSI across multiple timeframes is deeply oversold, particularly on the 4-hour and weekly charts, which historically precedes sharp bounces.
Today’s most critical observation is the DEMA compression on shorter timeframes. The distance between moving averages is shrinking, and when that happens, explosive moves typically follow. The question isn’t if AAVE will move—it’s which direction.
Looking ahead to the next 24 to 48 hours, we’re watching $250 like hawks. A break below this level opens the door to $235 or even $228. But if AAVE holds $250 and we see the 2-hour and 4-hour RSI indicators start climbing, expect a violent reversal toward $260 and potentially $270. The compressed springs release with force.
Our forecast remains cautiously bearish but with tight risk management. This isn’t the time for aggressive shorts given the oversold conditions. We’re positioned defensively, ready to pivot quickly. The market rewards patience at inflection points like these.
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AAVE/USDT Perpetual (Bybit)
Technical Analysis for AAVE/USDT.P
Advanced Chart for AAVE/USDT.P
This chart visually represents the consensus indicator scores across all analyzed timeframes, providing a clear, at-a-glance view of the prevailing market sentiment.
-1 = Bearish 🧸 ,+1=Bullish 🐂 ,+-0.5 weak Bullish/Bearish , 0(0.5-0.5) = Neutral
This chart plots the key price levels—floor, resistance, and ceiling—that we identified for each timeframe. It helps in visualizing the critical support and resistance zones.
Disclaimer
The content in this publication is for informational and educational purposes only and does not constitute financial, investment, or trading advice. I am not a licensed financial advisor.
Any opinions, strategies, or analyses shared reflect my personal views and experiences. I may hold positions in the cryptocurrencies mentioned (e.g., BTC, ETH, SOL), which could influence my perspective.
Cryptocurrency markets are highly volatile and involve significant risk. Always do your own research and consult a licensed financial advisor before making any investment decisions.
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