AAVE Reveals Potential Drop Chances to $115 Amid a Bear Market; Will Buyers Reverse the Trend?

Amid a bear market, the volatility in the AAVE token price is increasing, and the DeFi token gives sharp moves this week. With a weekly price range of more than 10%, it fluctuates within a broadening wedge.

AAVE reveals potential drop chances to $115 as a bear cycle forms in the 4-hour chart. Will buyers reverse the trend?

In a bear market, the AAVE token price showcases a heightened volatility with sharp moves this week. Being a DeFi token, the AAVE token price showcases a broader range of over 10% price fluctuation, trading within a broadening wedge.

As the whale’s buying spree picks up pace, will buyers manage a breakout rally?

AAVE Bull’s Trapped in a Megaphone

Being ranked 14 by market capitalization with a valuation of nearly $2 billion, the Aave token showcases a 24-hour price increase of 4.35%, trading at $130.07. However, on the 4-hour chart, the Aave token showcases a broadening wedge or a rising megaphone pattern with constant support at $115.

Despite the support, the bullish power seems to struggle to cross an overhead ascending trend line, forming a lower high. As a result, the Aave price action showcases a higher price rejection near the overhead trend line. Hence, forming an evening star pattern that breaks below the 23.60% Fibonacci level at $129.91.

Crucial EMAs 50 and 200 in the 4-hour chart showcase a slight bullish trend, ready to provide dynamic support. The 200 EMA provides crucial support at $115.

The MACD indicator showcases a positive trend in the MACD and signal line, but a downtick showcases a warning for a bearish crossover as the negative cycle begins within the megaphone pattern.

Founder Sell-off Meets Whale’s Buying Spree

This negative cycle might be correlated with the Aave founder, Stani Kulechov, who sold $6 million worth of Aave and continues to hold nearly $32.7 million worth of Aave tokens, which comes down to about 243,900 Aave tokens.

However, as the founder loses confidence, the Aave community seems to be on a buying spree as two Aave whales bought up $2.2 million worth of Aave tokens in the past two hours.

Will AAVE Give A Breakout Rally?

With growing confidence and an ongoing uptrend for the past few months, Aave is likely to cross the overhead trend line and break away from the bearish pattern. Based on Fibonacci levels, overhead resistances are 38.20% and 50% at $138 and $145.

On the downside, dynamic support at $125 of 50 EMA and the 200 EMA at $116 near the $115 support zone are crucial demand levels. A breakdown below $115 can test the psychological mark of $100.

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