Aave [AAVE], a prominent decentralized finance (DeFi) lending protocol, is garnering significant attention from large-scale investors and institutions, fueled by recent bullish price action. On May 2nd, AAVE broke free from a brief period of consolidation, setting the stage for a potential upward rally that has seemingly captured the interest of deep-pocketed entities.
Surging Whale Participation Hints at Further Gains
On-chain analytics firm IntoTheBlock reports a notable increase in whale activity surrounding AAVE. The platform’s data indicates that AAVE’s large transaction volume has surged by 8% in the last 24 hours. This substantial uptick in large transactions suggests growing confidence among significant holders and raises the question of whether this influx of capital could propel AAVE to even higher levels. Further reinforcing this bullish outlook, data from CoinGlass reveals that both retail investors and long-term holders appear to be aligning with this positive sentiment, placing bullish bets on the asset’s future performance.
Significant Outflows Signal Accumulation
Adding to the optimistic picture, data regarding spot exchange inflows and outflows reveals a substantial net outflow of AAVE tokens. Over the past seven days, a significant $6.88 million worth of AAVE has been withdrawn from exchanges. This consistent outflow, which has been observed since April 7th, often indicates accumulation by investors who are optimistic about future price appreciation. Such accumulation can reduce the available supply on exchanges, potentially creating buying pressure and further supporting a bullish trajectory for the asset.
Bulls Dominate Trading Positions
Beyond whale and institutional interest, on-chain metrics indicate a strong bullish sentiment among traders as well. At the time of reporting, data from Binance showed that 61.72% of AAVE traders were holding long positions, while only 38.28% were positioned short. This dominance of long positions suggests a prevailing belief in further price increases, which could contribute to pushing the token towards new highs.
At press time, AAVE was trading near $173.75, having recorded a 2.5% price increase over the preceding 24 hours, accompanied by a modest 5.5% jump in overall trading volume. Technical analysis suggests that if AAVE can maintain momentum and close above the $174 mark, a potential 14% upside move towards the $200 level could materialize. However, failure to sustain this level could present challenges for a continued rally in the short term.
Disclaimer: The information in this article is for general purposes only and does not constitute financial advice. The author’s views are personal and may not reflect the views of Chain Affairs. Before making any investment decisions, you should always conduct your own research. Chain Affairs is not responsible for any financial losses.
Also Read: Ripple’s RLUSD Joins Aave V3 with $50M Cap, Targets USDT and USDC in DeFi Push
I’m a crypto enthusiast with a background in finance. I’m fascinated by the potential of crypto to disrupt traditional financial systems. I’m always on the lookout for new and innovative projects in the space. I believe that crypto has the potential to create a more equitable and inclusive financial system.
