AAVE, the DeFi token, has experienced a bullish reversal after rebounding strongly from the $118 support level. Technical indicators, such as the RSI and EMA trends, suggest that the upward momentum could continue, potentially pushing the price of AAVE above $200 by the end of September.
In the 4-hour chart, a double-bottom reversal pattern can be observed as the price of AAVE underwent a pullback phase that concluded at $118. Despite a 17% drop within a week, the underlying demand acted as a cushion, leading to a lateral shift in the price movement. The ongoing recovery has created a bullish engulfing candle in the daily chart, indicating a positive trend.
Currently, AAVE is trading at $131.88, reflecting a struggle to maintain momentum, but the broader recovery in the DeFi market suggests that the uptrend in AAVE is likely to continue.
The 4-hour RSI line indicates a bullish divergence, with a rising bull cycle emerging from a sideways range. This indicates a stronger approach from the bullish side. Additionally, the 200 and 50 EMA in the 4-hour chart act as boundaries for the consolidation range, and a breakout from either side will determine the next phase of AAVE’s price movement.
Based on trend-based Fibonacci levels, AAVE is challenging the 23.60% level at $134, with overhead supply acting as a barrier. If a breakout occurs, the price could potentially reach upside targets at $155, $183, and $207, based on the 50%, 78.60%, and 100% Fib levels, respectively. On the other hand, if the price falls below $118, it may test the psychological mark of $100.