Aave Protocol: Innovations, AAVEUSD Performance, and Trading Strategy

Aave is a decentralized, non-custodial liquidity protocol where users can participate as depositors or borrowers. Aave is a decentralized, non-custodial liquidity protocol that allows users to participate as either depositors or borrowers. Depositors can provide liquidity to the market in order to earn a passive income, while borrowers can either borrow in an over-collateralized (perpetually) or under-collateralized (one-block liquidity) fashion. Two of the major innovations of the Aave protocol are the stable rate, which helps borrowers with financial planning, and the flash loan rate, which allows borrowers to borrow without collateral during a single transaction. Among the tokens, AAVEUSD was one of the best performers today. Any daily close above $118 will confirm further bullishness. AAVEUSD has been the best performer over the past two days, surging more than 25% after breaking through significant resistance at $118. The pair is holding well above the short-term (21 and 55 EMA) and long-term moving average. It hit a high of $93 and is currently trading around $92.16. The bullish invalidation will occur if the pair closes below $70. On the lower side, the near-term support is at $87. Any break below will target levels of $80 and $70. A breach below $70 will target $50. Immediate resistance is present around $100. Any breach above will confirm a minor pullback. A move to $118 and $135 is possible. A surge past $135 will take AAVE to $173. It is advisable to buy on dips around $80 with a stop loss at $70 for a TP of $118 and $135.

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