The price of AAVE surged by 18% in the past 24 hours.
The selling pressure of the token has increased, suggesting that the price will slightly correct.
AAVE has performed exceptionally well in the past 24 hours, with its price rising by double digits. As a prominent analyst predicted, the recent upward trend could push the token price further above $400.
Therefore, AMBCrypto evaluated its indicators to determine whether the path forward is clear.
AAVE bulls are in action
AAVE is decoupling from top cryptocurrencies, as its price has increased by 18% in the past 24 hours. As of the time of writing, it is trading at $378 with a market cap of over $5.6 billion.
Renowned cryptocurrency analyst Ali Martinez tweeted that if one condition is met, the token price could experience similar growth. According to the tweet, an Adam and Eve pattern is forming on the token chart. If it successfully breaks through the resistance zone at $342, the token price may soon exceed $400.
Specifically, Martinez mentioned that a breakout could lead to a price increase of 19%. Fortunately, the token successfully broke out, and as of the time of writing, it is heading towards the $400 mark.
The recent price increase has also positively impacted the social metrics of the token. For example, its weighted sentiment has entered positive territory, indicating that bullish sentiment around AAVE is rising.
Its social volume has also increased—an obvious sign of the token's popularity in the cryptocurrency market.
The likelihood of AAVE maintaining its growth
Subsequently, AMBrypto examined the on-chain data of the token to understand whether this bull market will continue. According to the analysis, recent selling pressure seems to have increased.
The supply of AAVE on exchanges has increased while the supply off exchanges has decreased. Whenever this happens during a bull market, it indicates that investors are cashing out profits, which usually leads to a price correction.
Another bearish indicator is the MVRV ratio, which has slightly decreased after a promising rise on December 23.
Similar to the above indicators, Coinglass data shows that there are more short positions than long positions in the market, as the long/short ratio of the token (4 hours) has declined over the past 24 hours.
If a price adjustment occurs, it will be crucial for AAVE to test its support level at $366 to rebound towards $400 in the coming days.
However, if the token falls below the support level, its price may drop again to $301.
