AAVE has emerged as one of the most profitable cryptocurrencies in the new week as Bitcoin’s bullish momentum pauses after a weekend sell-off.
The second largest decentralized financial stock rose 11.36 percent, or $ 22, to an intraday high of $ 522.74, confirming a bullish reversal after falling 28 percent from a record high of $ 547. AAVE’s retreat emerged as its price tested the 50-4H simple moving average as support, a wave that has recently capped AAVE / USD losses as they turned into a full-fledged bearish attack.
AAVE recovers after testing its 50-4H moving average for support. Source: AAVEUSD on TradingView.comAAVE is rebounding after testing the 50-4H moving average as support. Source: AAVEUSD on TradingView.com
“New ATH” possible
Many analysts agreed that AAVE will not be able to regain its previous record or establish a new one as the token – as a DeFi credit protocol – is gaining acceptance among new users.
$ AAVE on the go and looking for a new ATH. Possible entry AFTER the profit or during retracement (both are legitimate). #AAVE #altcoins #Binance pic.twitter.com/CWGqb9IM35
– DoopieCash® (@DoopieCash) February 8, 2021
According to statistics from Dune Analytics, AAVE, along with its competitors Compound and MakerDAO, has processed credit calls valued at $ 606.8 million in the past seven days. This was a big contrast to the amount the trio had borrowed over the past 30 days: just over $ 1.5 billion.
In the meantime, billionaire investor Mike Novogratz provided further tailwind for the AAVE rally by counting it among the five largest cryptocurrencies alongside Bitcoin. In a live stream chat with Grammy nominated artist Lil Yachty, Galaxy Digital founder / CEO said tokens like AAVE would “blow up the world”.
“These are the tokens that the banks want to take and rip the limbs of the banks from the limbs that JPMorgan and the New York Stock Exchange want to replace, and that’s why I put some money into these things,” he added. “It’s a lot riskier, but if it works it’s going to be a much bigger payoff.”
AAVE is licensed for electronic money in the UK. This makes AAVE the only DeFi project that has received regulated company status from the Financial Conduct Authority.
What’s next for AAVE?
Technically, AAVE / USD is trading within an ascending channel range, as confirmed by a series of higher highs and higher lows since early January.
AAVE eyes are breaking out towards $ 650. Source: AAVEUSD on TradingView.comAAVE eyes break towards $ 650. Source: AAVEUSD on TradingView.com
Traders see a retest of $ 547 as a close above that level expects their long targets to be stretched towards the resistance trendline of the ascending channel. Meanwhile, a pullback would cause them to open a short position towards the 20 to 4 hour moving average support in green.
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