Aave faces key price test as crypto market eyes breakout levels
Aave price nears resistance at $346 after rebounding from key $307 support
Aave (AAVE/USD) is trading near $323 as it faces significant resistance at $346, a level aligned with a descending trendline. The cryptocurrency's performance has caught the market’s attention due to its rebound from a crucial support level of $307.
This bounce aligns with the 200 EMA, indicating a strong defense by buyers at this technical zone.
However, the broader crypto market remains wary of near-term volatility, influenced by macroeconomic factors, including fluctuating oil and natural gas prices and forex market movements.
Aave price movement (Nov 2024 - Jan 2025) Source: TradingView.
4-hour chart insights: Support vs. resistance
The four-hour chart reveals a descending triangle formation, traditionally a bearish signal. Key support holds at $305 and $307, reflecting historical consolidation levels. Resistance stands at $346, with a stronger barrier at $361, which aligns with recent price peaks.
Technical indicators present mixed signals. The Relative Strength Index (RSI) is neutral at 45–50, suggesting potential for upward momentum if it crosses above 60. However, the Stochastic Oscillator signals overbought conditions, indicating a possible price pullback.
Daily chart outlook: Bullish potential vs. bearish risks
On the daily timeframe, Aave is attempting to break free from its consolidation range. Resistance levels at $370 and $400 represent bullish targets if the cryptocurrency sustains a breakout above $346. Key support at $261 serves as a critical long-term defense.
Exponential Moving Averages (EMAs) indicate caution, as the price hovers around the 50 EMA but stays above the 200 EMA, hinting at medium-term bullish momentum. Market participants are watching trading volumes closely for confirmation of any trend reversal or continuation.
Traders remain focused on economic data and regulatory developments impacting cryptocurrency sentiment. A breakout above $346 with robust volume could pave the way for Aave to target $370 and $400. Conversely, a sustained dip below $307 could intensify bearish sentiment, with downside targets at $280 and $261.
In our previous coverage, we discussed how Aave and Lido led the DeFi sector with over $70 billion in combined net deposits.
