Whale Sell-Offs Shake AAVE—Is a Price Drop to $128 Inevitable?

Sean Williams
AAVE

Getting your Trinity Audio player ready...

AAVE ($165.8), one of the leading DeFi lending protocols, has witnessed increased whale activity, raising concerns over a potential price correction. Despite recent gains, large-scale token movements by key players suggest caution for traders.

Whale Transactions Raise Red Flags

Blockchain analytics firm Lookonchain has reported significant sell-offs from two major whale wallets. Address 0xd282 transferred 30,001 AAVE (worth $4.98 million) to FalconX and still retains 37,425 AAVE ($6.33 million), securing a total profit of $11.8 million.

Similarly, wallet 0x1AdC moved 11,018 AAVE ($1.86 million) to OKX, incurring a $293,000 loss. These transactions suggest that high-volume traders might be exiting positions or taking profits, potentially exerting downward pressure on AAVE’s price.

However, Kiraverse, a multiplayer game built on Unreal Engine 5, disputed the bearish narrative, claiming that at least one of these transactions was part of a strategic asset redistribution. If accurate, this could alleviate some of the negative sentiment surrounding AAVE’s price action.

AAVE Price Analysis: Resistance and Key Levels to Watch

As of press time, AAVE is trading at $166.29, marking a 7.18% increase over the past 24 hours, according to CoinMarketCap. The token faces strong resistance at the 20-day Exponential Moving Average (EMA) of $177.84.

The Relative Strength Index (RSI) currently stands at 41.28, indicating a neutral-to-oversold range. A further dip below 40 could signal increased downside pressure. Additionally, AAVE is hovering near the lower Bollinger Band at $157.72, a crucial support level. If this level holds, a bounce toward the mid-band at $174.81 or upper band at $191.90 could be possible.

Source: TradingView

Conversely, a price drop below $159 could pave the way for further declines toward $128, according to analyst Reed Carson.

AAVE’s Long-Term Strength in DeFi

Despite the short-term uncertainty, AAVE remains a dominant force in the DeFi sector, controlling approximately 65% of the digital asset lending market, per Token Terminal. DeFiLlama data also shows that AAVE’s total value locked (TVL) has consistently hit new all-time highs in ETH terms since December, indicating robust adoption.

Also Read: AAVE Price Analysis: Can a Breakout to $240 Defy the Bearish Trend?

While AAVE may experience short-term price volatility, its long-term potential remains intact. If the $128 support level is tested and buyers step in, it could present a compelling opportunity for traders looking for a rebound.

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.

Related Posts