Aave (AAVE) Price Breaks Above Long-Term Pattern, What Next?
The Aave (AAVE) price has broken above a long-term pattern and confirmed the previous horizontal resistance as support. It is expected to continue rising in the near future.
The Aave (AAVE) price has been trading within a symmetrical triangle since May 2022. This is a neutral pattern, so the further trend will be confirmed when the price breaks out of it.
After bouncing up from the channel support in early September 2023 (green arrow), the price broke above the triangle during the week of October 16 to 22, confirming that the trend is bullish.
Indeed, this momentum helped the price break above the horizontal resistance zone at $86 in the following week, indicating strong buying pressure at higher levels.
The target for this pattern is $153, calculated by measuring the height of the pattern and adding it to the breakout point.
The weekly RSI (Relative Strength Index) supports the continuation of the uptrend towards the pattern target as it is above 50 and trending upward.
The daily chart shows that the AAVE price has been trading within an ascending triangle since October 28, 2023. This is a bullish pattern, often leading to breakouts in most cases.
However, yesterday’s breakout resulted in a candle with a long upper wick, a sign of selling pressure.
The daily RSI has created a bearish divergence after yesterday’s candle. This is a bearish sign, signaling a potential correction.
Therefore, the AAVE price may decline to the $100 level, formed by the previous horizontal resistance zone and the 0.618 Fib level of the recent rally. Afterward, it will likely make another breakout attempt.
The most likely scenario suggests that the AAVE price will continue to rise in the near future. The potential target for this movement is $153.
This outlook would be invalidated if the AAVE price breaks down below the recent low at $87.35.
Disclaimer: Please note that this article is for informational purposes only and should not be taken as investment advice. As an investor, it is important to do your own research before making any decisions. We are not responsible for any investment decisions you make based on this information. Not Financial Advice.
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