Expert says suspense builds for Polygon (MATIC) and Aave (AAVE): Will October be their rise or fall?

October is once again proving to be a robust month for the crypto market, especially for Bitcoin, which has impressively soared to its highest levels of the year, breaking through the $35,000 mark. Despite the circulation of misinformation regarding the approval of the first Bitcoin spot ETF, Bitcoin’s value remained resilient, showing that the market was able to quickly brush off these inaccuracies. The unwavering strength of the market truly reflects the immense anticipation and hope investors have placed on the long-awaited approval of a Bitcoin spot ETF. This upbeat attitude and sustained momentum in the market is quite inspiring, especially considering the various uncertainties we’re facing worldwide.

Bitcoin has impressively shattered the formidable $32,000 resistance barrier, a hurdle that stubbornly held its ground since May of the previous year, showcasing the cryptocurrency’s strength and resilience. Now, comfortably cruising above the 200-week moving average and turning that previous resistance into a supportive foundation, the crypto community is abuzz with chatter and speculation, eagerly pondering whether this bullish momentum is here to stay. Many are even considering the possibility of Bitcoin reaching or surpassing the $40,000 mark.  

In the broader cryptocurrency landscape, certain altcoins such as Polygon (MATIC) and Aave (AAVE) are also making waves with their impressive double-digit gains. According to Mike Ermolaev, the founder of Outset PR and crypto market analyst for FXStreet, this notable performance adds another layer of intrigue and opportunity to the ongoing market situation. 

Polygon (MATIC) soars amid user onslaught, but whales lurk

Following the announcement of a fresh governance protocol council, the Polygon team witnessed a record number of new users flocking to the network, which caused an impressive price surge. Recent days have seen MATIC re-embrace the $0.6 mark, successfully erasing the losses of a somber September.

However, Ermolaev notes that the Polygon whales continue their sales rage, posing a notable threat to the ongoing MATIC price breakout. When we take a closer look at the Whale Wallet Balance chart, we can see that big investors selling off might impact the broader market. The numbers reveal a clear trend: the holdings of MATIC by major investors have been on a gradual decline.

Source: Santiment

This sustained sell-off activity, amounting to a significant quantity of MATIC tokens over the last couple of months and worth tens of millions at the current price, sends a clear message: big market players are actively reducing their stake in the token.

Polygon (MATIC) technical analysis

Source: TradingView

The expert points out that MATIC has been navigating a delicate balance for some time now, with its price moving within a range defined by several crucial support and resistance levels. On the upper side, the first resistance point is noticeable at $0.6532, climbing towards the 13-week high near $0.7359 and the 1-month high at $0.6644. If the positive vibe keeps up, these points could be key spots where the asset’s value really takes off.

On the flip side, the support structure for MATIC paints a different picture. The first line of defense for the bulls is found at $0.5998, while lower down, the 2nd support point and the 1-month and 13-week lows hover around the $0.5786 and $0.4930 levels, respectively. If bearish pressure ramps up, these low points are crucial since they've been places where MATIC has managed to find stability before, and it might just be able to pull off the same trick again.

MATIC’s interaction with various moving averages adds an extra layer to its technical narrative. The price’s recent crossing of the 9-18 day moving average at $0.4888 and the 40-day moving average at $0.5351 underscores its current upward trajectory. However, stalls at the 3-10 day MACD Oscillator and the 18-day moving average signal potential zones of market hesitation, suggesting that traders are carefully weighing their next moves.

Polygon (MATIC): Where it heads next

Based on Ermolaev’s analysis, the spotlight is now on the delicate tussle between the robust retail market and the MATIC whales. If the former continues its buying spree and manages to offset the selling pressure of the latter, MATIC could potentially shoot past its recent highs. 

On the other hand, if the whales intensify their selling streak and if the overall crypto market faces unforeseen external pressures, MATIC prices might not only stall but could also potentially dip, testing its support levels.

Aave (AAVE) hits an impressive milestone during liquidation surge: What to expect?

Monday morning came with a bang for AAVE as its trading volume saw a dramatic rise, primarily driven by a spike in short trades. This resulted in a short liquidation hitting a staggering $1,200,000 on October 23. 

Source: Coinglass

With the AAVE price showing a promising uptick, one can't help but wonder: is this just the beginning of a bull run or the peak before a potential downturn?

Aave (AAVE) technical analysis

Source: TradingView

The analyst highlights that AAVE is currently traversing through a range of crucial turning points, with its price situated between the first support point at $78.89 and the first resistance point at $88.53. Capturing the current mood of the market and giving hints at AAVE's possible future movements, this price range is particularly telling and holds a lot of weight.

At the higher end of this range, resistance is formidable. The 1-month and 13-week highs both converge at $90.72, creating a ceiling that may prove challenging to breach. Breaking through this level in AAVE could kickstart a strong upward trend, making this spot a very important turning point. However, with the asset's price recently tracing around $82.99, and considering its interaction with the 9-18 day moving average at $68.54, the market seems to be in a state of anticipation, closely watching how AAVE navigates these pivotal points.

On the downside, the first support point at $78.89 stands as an immediate cushion, while further down, the 1-month low at $59.99 and the 13-week low at $50.31 provide additional safety nets. Ensure AAVE's stability is heavily reliant on these levels, especially if bearish pressure becomes more pronounced. Also, AAVE's connection with different moving averages, like the slowdowns at the 18-day and 40-day moving averages at $66.96 and $62.15 respectively, makes its support system stronger and provides possible areas for a bounce back.

Aave (AAVE): Where it heads next

Given the recent surge in trading volume and positive sentiments around the AAVE token, Ermolaev suggests that, with sustained buying pressure and if the price maintains above the $75 mark, AAVE could enter a prolonged bullish trend.

However, the dark cloud of selling pressure can't be ignored. If the market succumbs to this pressure, AAVE might be forced to face a correction, potentially tumbling down to its critical support levels.

Closing thoughts: What the future holds for Polygon (MATIC) and Aave (AAVE)

The current positions of both Polygon (MATIC) and Aave (AAVE) in the cryptocurrency market result from both internal developments and external market conditions. MATIC's future prospects are contingent upon three major factors: ability to uphold its current momentum, entice a new user base, and effectively manage the influence wielded by large-scale investors. Whereas, AAVE’s further stance will be influenced by its ability to hold above critical support levels and continue generating positive market activity.

Both assets, like all cryptocurrencies, are subject to market volatility and risks. So if you're investing, it's super important to stay alert, be aware of the market's ups and downs, and not let emotions drive your decisions. Navigating the tumultuous crypto landscape with confidence becomes possible when you empower yourself through staying knowledgeable and maintaining a composed demeanor, ensuring that your decisions are both steady and well-founded.