AAVE advances amid heightened USDT deposits boosting protocol activity: weekly forecast

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Aave advances 19.41% over the week

Highlights

AAVE remains under heavy medium- and long-term selling pressure, trading below all key moving averages with no nearby support.
Momentum indicators show a strong sell bias, with oscillators signaling trend exhaustion despite last week's 19.41% rally to $86.79.
Expected price action favors sideways consolidation between $78.00 and $95.00, with a higher likelihood of downside as no indicators signal a buy.

Protocol demand surges as USDT inflows and expansion plans lift activity

Aave saw heightened activity in its decentralized finance protocol as rising USDT deposits strengthened its lending and borrowing ecosystem, with trading volume more than doubling the past month's average. The protocol is considering a cross-chain expansion for its stablecoin sGHO using Chainlink CCIP, which would maintain accounting on Ethereum while broadening access. In addition, founder Stani Kulechov outlined plans for Aavenomics 3.0, including automated token buybacks and a deeper focus on tokenized real-world assets, while Standard Chartered began institutional research coverage.

Momentum remains bearish for the week despite overbought signals

Weekly technical signals for AAVE remain negative. The asset trades below its MA-20, MA-50, and MA-200, with no immediate dynamic support. Momentum indicators on the W1 timeframe are bearish: MACD shows a strong sell bias, ADX confirms a prevailing downtrend, both the RSI and Commodity Channel Index trigger sell signals, and Bull/Bear Power shows seller dominance. The Stochastic RSI is fully overbought at 100, pointing to possible exhaustion. The Awesome Oscillator remains neutral, failing to support any trend direction.

Sideways range favored as upside capped by technical resistance next week

The weekly forecast anticipates a broad trading range between $78.00 and $95.00 over the next 7 days, reflecting persistent high volatility. With none of the four major weekly indicators signaling a Buy, there is less than a 20% chance of sustained upside. The baseline scenario favors sideways consolidation as the market digests recent gains, with bearish pressures likely to dominate and downside scenarios targeting the $75.00 level if $80.00 support fails. Any break above $95.00 could prompt short-term momentum buying, but moves are likely capped by resistance from higher moving averages.

Parshwa Turakhiya, analyst, notes that Aave delivered a robust 19.41% weekly gain, but still struggled beneath all key moving averages, reflecting continued seller pressure. He observes that positive sentiment was driven by surging USDT deposits and fresh protocol developments, yet weekly momentum and oscillator signals remain bearish, with no clear buy setup. The analyst sees the coming week as a test of whether recent gains can be digested with sideways action or if sellers will push the price down towards $75.00. Turakhiya favors a cautious approach. "With momentum indicators skewed bearish and resistance looming near $95.00, I remain selective this week and will only reconsider if AAVE can firmly break above recent highs."

Earlier, analysts noted that while Aave was demonstrating strong protocol momentum and recovering adoption, its price action remained constrained by a broader bearish structure. The current analysis reinforces that view with new evidence of persistent downside pressure despite recent gains, making the $95.00 level a key upside pivot to monitor as bearish technicals and high volatility dominate the near-term scenario.

Source of Data: AAVE Price Analysis by TU

The analysis is based on a proprietary model combining technical, on-chain, and expert data. Not investment advice. See methodology

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