- The support zone targeted by AAVE is the one at 295-300 and maintaining this zone would move the token in the direction of the upper channel of 400.
- The next resistance of AAVE is located at $320, which also serves as a very important medium resistance since traders analyze the price movement of a day and market momentum.
- The MC/TVL ratio hits a two-year low, signaling strong capital inflows boosting TVL while price consolidates near key support.
AAVE is testing critical support at $295–$300 on the daily chart, determining whether the token continues its upward trend toward $400. Traders are observing this level closely for potential price movement.
Technical Setup at Channel Support
AAVE is currently positioned near the lower boundary of its rising daily channel. This $295–$300 zone has historically acted as a strong support level, providing a base for potential rebounds.
CryptoPulse noted that a bounce from this support could propel the price toward the upper channel near $400. Holding this level would indicate that the bullish structure remains intact and momentum could continue.
If the support breaks and AAVE closes below $285, the token would exit the rising channel. The next support would likely appear around $250, signaling a possible pullback from current levels.
Short-Term Resistance and Market Activity
Traders are watching near-term resistance as AAVE approaches the $320 level. CW highlighted that this is the next notable sell wall for the token, potentially limiting upward movement.
This resistance is positioned between the current price and the $400 upper channel target. Overcoming it would require strong buying momentum supported by trading volume and market interest.
AAVE’s 24-hour trading volume stands at $391,288,697, reflecting active participation around the current support. These volume levels are critical in determining whether the bounce scenario or the breakdown scenario prevails.
MC/TVL Ratio Signals
Fundamental data shows that AAVE’s Market Cap to TVL ratio dropped to its lowest level in two years. This occurred while the token’s price rose, creating an unusual divergence between price and fundamentals.
Normally, the ratio increases as the market cap grows with price. The current divergence indicates that TVL grew faster than market capitalization, likely due to capital inflows into AAVE’s contracts.
This trend may suggest the token is relatively undervalued if TVL remains stable. Traders are monitoring the quality of TVL and overall market conditions to assess whether the current growth is sustainable.
