At the moment, Aave has around $23.7 billion in loans on its platform. This goes to show how popular the platform has become and how much faith the community has in it since it has become the most popular decentralized financial platform.
Source: @tokenterminal
The largest portion of this lending, worth around $19.4 billion, takes place on the Ethereum mainnet. The strong smart contract system of Ethereum enables Aave to run its services efficiently. This underlines the importance of the Ethereum network for DeFi and its usage as a stability anchor for Aave. This is due to scalability and wide user participation in lending and borrowing activities.
Also Read: AAVE Price Shock: 18% Surge Predicted in 5 Days
AAVE Price Breakout Signals Bullish Shift
However, the crypto analyst, Whales_Crypto_Trading, revealed that AAVE is moving in a descending triangle, with lower highs pushing against a strong horizontal support level of $131-$136. After a period of consolidation, there was a strong break above the support level, making the bearish pattern null and void. This break was accompanied by strong momentum, re-establishing possession of MA 50.
The first level of resistance is around 167-170, followed by the strong level of resistance between 174 and 182. A successful breakout above this level unlocks the way to move further up. The former level of resistance around 150-155 and MA50 are now strong supports on any correction.
Source: @WHALES_CRYPTOt
With the use of the measure move in the descending triangle, the upside targets range towards $200, and the major target area is about $210-$220. The fact that volume is low above the resistance indicates that the price can move faster once acceptance is gained. The bullish outlook will continue to be in play as long as the price is above $150-$155. The targets will then be $182, $200, and $220.
Weekly Indicators Show Consolidation Within Uptrend
On the weekly chart, the MACD is still positive, indicating that the overall trend is still positive. However, the MACD is now just below the signal line, and the histogram is slightly red. This is an indication that the momentum is slowing down and not necessarily changing direction.
Source: TradingView
RSI is around 54, which is above the crucial 50 mark, signifying a bullish market without any overbought signals. The momentum has restarted from a lower level, which signifies a period of consolidation. Based on RSI and MACD, it can be inferred that there might be a pause in the uptrend phase, which might continue if the momentum starts rising.
