Aave Price Forecast: AAVE primed for breakout as bullish signals strengthen
|- Aave price continues to trade within a descending parallel channel pattern, with a breakout potentially paving the way for an upward move.
- On-chain and derivatives data indicate bullish sentiment, with large whale orders, cooling conditions, and buy-side dominance.
- The technical setup supports a potential breakout, with the pattern’s measured target near $296.
Aave (AAVE) price is trading above $204 at the time of writing on Friday and approaching the upper boundary of its descending parallel channel; a breakout from this structure would favor the bulls. Moreover, on-chain and derivatives data also support bullish sentiment, while the pattern’s technical target suggests a rally above $296.
Aave’s on-chain and derivatives data show a bullish bias
CryptoQuant’s summary data also supports the bullish outlook, as Aave’s spot and futures markets show large whale orders, cooling conditions, and buy dominance. These factors signal a potential rally in the upcoming days.
On the derivatives side, Aave’s funding rate data also support signs of a rally. According to Coinglass’s OI-Weighted Funding Rate data, the number of traders betting that the price of Aave will slide further is lower than those anticipating a price increase.
The metric has flipped to a positive rate on Wednesday and stands at 0.0088% on Thursday, indicating that longs are paying shorts. Historically, as shown in the chart below, when the funding rates have flipped from negative to positive, Aave’s price has rallied sharply.
Additionally, Aave’s long-to-short ratio reads 1.01 on Thursday, nearing the monthly high. This ratio, above one, reflects bullish sentiment in the markets, as more traders are betting on the asset price to rally.
Aave Price Forecast: Aave nears upper trendline, eyes bullish breakout
Aave price trades within a descending parallel channel pattern (formed by connecting multiple highs and lows with two trendlines). At the time of writing on Friday, AAVE is approaching the upper boundary of this channel, and a breakout above it would signal a potential bullish shift.
If buyers push the price above the trendline, the measured move—based on the channel’s width—points to a technical target of $296.14.
The Relative Strength Index (RSI) on the daily chart reads 57, above the neutral level of 50, indicating bullish momentum gaining traction. Additionally, the Moving Average Convergence Divergence (MACD) showed a bullish crossover, which remains intact, further supporting the bullish thesis.
Looking up, if AAVE faces a rejection from the upper trendline boundary, it could extend the decline toward the daily support level at $201.08.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.