AAVE struggles to maintain gains amid selling pressure
AAVE has failed to sustain its recent breakout and now trades below all major EMAs, signaling renewed short-term weakness. After briefly climbing toward $270, the price reversed from the top of a rising channel and has since broken down.
Highlights
- AAVE rejected near $270 and is now trading below the 20, 50, 100, and 200 EMAs
- Net outflow of -$1.64M on August 5 signals increased exchange activity and possible selling
- Protocol completed $15.7M in buybacks at an average of $223.33, signaling strong fundamentals
AAVE is now hovering around the $260–$261 zone, with immediate resistance near $266. Until the price reclaims this level with a strong close above $270, bearish pressure is expected to dominate. Support sits near $258, with a breakdown exposing $250 as the next downside target.
Short-term weakness meets long-term strength
The technical setup on the 1-hour chart is bearish. The recent breakout from the falling channel failed to establish a sustainable trend, with price slipping back below all EMAs. The RSI has recovered slightly to 52 after dipping into oversold territory, suggesting a short-term bounce, but the lack of follow-through above $266 keeps the outlook fragile.
AAVE price dynamics (Source: TradingView)
On-chain exchange data supports this caution. The negative netflow of -$1.64 million on August 5 reflects tokens moving to exchanges, which typically precedes selling. With momentum stalling below resistance and bearish flow data, short-term upside looks limited unless AAVE can close above the $270 threshold.
Buyback-driven confidence and protocol dominance
Despite the technical pullback, AAVE’s fundamentals remain strong. The protocol has executed $15.7 million in token buybacks at an average cost of $223.33, showing significant unrealized gains. Funded at $1 million per week, this initiative is designed to halve emissions and restore long-term value. Co-founder Mark Zeller noted this as a key step toward investor confidence and protocol sustainability.
In earlier analysis, AAVE had broken out from a prolonged falling channel, initiating a relief rally that pushed the price toward $270. However, this rally lost momentum near the upper boundary of a rising channel, and the price has since broken down from that structure. Currently, AAVE is trading below all major EMAs (20, 50, 100, 200), highlighting renewed short-term weakness.
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