August 17, 2022


AAVE price action has finally breached the descending resistance after it struggled to find a directional base over the past few days. The move came after the protocol announced the launch of a new liquidity mining program for optimism.

The announcement of the upbeat liquidity mining program may have encouraged a shift in investor sentiment in favor of the bulls. This is because optimism is one of the most popular Ethereum Layer 2 scaling solutions that facilitate large volumes.

According to her website, Optimism on the chain is worth $800 million. In fact, it also claims to have helped save more than $1 billion in gas fees.

AAVE سعر price action

The impact on AAVE’s price action means that investors expect the move to increase demand for the cryptocurrency. Although AAVE managed to break through the descending resistance, it still needs to face friction at the pressure time level near the $101 price range.

This, because the same level depicts resistance in the second half of July.

Source: TradingView

AAVE’s bullish trend over the past 24 hours has been thanks to buying pressures that have been building since August 2nd. This was around the same time that the MFI pivoted due to backlog, and the same is true for the RSI. However, it is unclear whether the recent uptrend will continue.

AAVE’s current bullish performance may be short-lived unless the market can maintain the positive sentiment. That’s because the supply held by the Headline Scale posted a 0.41% decline in the past 24 hours, indicating that whales were benefiting.

The upside was also supported by a smaller increase in active titles, compared to the previous surge in headlines on August 3.

Source: Santiment

AAVE’s whale transaction count has also recorded an increase in activity in the past two days and this has supported the recent upward trend.

However, whale transactions were within the average daily number. Nothing out of the ordinary in terms of buying pressure.

Source: Santiment

conclusion

Although AAVE’s price rally reflects the announcement of optimism, its on-chain metrics show the lack of strong momentum. Therefore, the upside in the short term may be limited.





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