AAVE has shown remarkable performance in the past day, with significant gains in its price. This recent upward trend could potentially propel the token above $400, as indicated by a well-known analyst.
Therefore, CryptoCrypto conducted an analysis of its metrics to determine the clarity of the path ahead.
AAVE Bulls in Motion
AAVE separated itself from the leading cryptocurrencies by experiencing an 18% increase in price within the last 24 hours. Currently, it is being traded at $378 with a market capitalization exceeding $5.6 billion.
An influential crypto analyst, Ali Martinez, shared a tweet suggesting a possible surge if certain conditions were met. The tweet hinted at the formation of an Adam and Eve pattern on the token’s chart. Should there be a successful breakthrough above the $342 resistance level, the token could soon surpass $400.
Martinez specifically noted that a breakthrough might lead to a 19% surge in price. Fortunately, the token did achieve a successful breakthrough and is now steadily approaching the $400 threshold.
This recent price surge also had a positive impact on the token’s social indicators. For instance, its weighted sentiment turned optimistic, signifying an increase in bullish sentiment surrounding AAVE.
Furthermore, the social volume of the token witnessed an increase, indicating its growing popularity in the cryptocurrency market.
Likelihood of AAVE Sustaining the Surge
Cryptorypto then delved into the token’s on-chain data to evaluate the potential continuation of the current bullish trend. According to the analysis, there appeared to be an uptick in selling pressure in recent times.
The supply of AAVE on exchanges rose while its supply off exchanges decreased. When such a scenario unfolds during a bullish rally, it suggests that investors are capitalizing on profits, often leading to price corrections.
Another bearish indicator was the MVRV ratio, which experienced a slight dip after a promising rise on December 23.
Corresponding to the aforementioned metrics, data from Coinglass indicated a surplus of short positions in the market compared to long positions, with the token’s long/short ratio (4-hour) decreasing over the last day.
In the event of a price correction, it becomes vital for AAVE to test its support level at $366 to initiate a potential rally towards $400 in the forthcoming days.
However, a breach below this support could cause the price to fall back to $301 once again.