AAVE price is one of the few altcoins showing bullish momentum, even as the broader crypto market faces bearish signals. However, the altcoin might encounter headwinds due to selling activity from influential whale investors.
AAVE Faces Potential Selling Pressure
Whale investors, who hold significant amounts of AAVE, could slow down the altcoin’s recent gains. These large wallet holders have a substantial impact on price movements, with their actions often driving market trends. While AAVE holders with balances between 10,000 and 100,000 tokens had been accumulating since late July, they recently sold over $5.25 million worth of AAVE in just the last 48 hours.
Although this sell-off represents a small fraction of their total holdings, it has temporarily stalled AAVE’s rally over the past few days. Despite this, AAVE has a chance to counteract this bearish pressure.
AAVE’s Advantage: Low Correlation with Bitcoin
One key factor working in AAVE’s favor is its reduced correlation with Bitcoin. Currently, the correlation between AAVE and Bitcoin has dropped to a low of 0.03, meaning AAVE is moving independently from Bitcoin’s price trends. Given that Bitcoin was experiencing slight bearishness at the time of writing, AAVE’s dissociation from the broader market could help it maintain its upward momentum. This separation might also minimize the impact of any further whale selling.
AAVE Price Prediction: Potential Rally Ahead
AAVE is currently trading around $105 and is moving within a broadening ascending channel. This pattern, characterized by higher highs and higher lows, often signals a potential trend continuation or reversal. AAVE confirmed this pattern during its late-July rally, strengthening the likelihood of a breakout.
If AAVE can break above the $124 resistance level, it could trigger a 30% rally, pushing the price toward $163. However, for this bullish scenario to play out, AAVE needs to turn $116 into solid support. These levels have acted as resistance in the past, and failure to breach them could invalidate the bullish outlook, leading to continued consolidation between $116 and $89.
