Chart Analysis and Recommendations:



Target and Prices:



The chart highlights Fibonacci extension levels for AAVE. In particular, the 1.272 and 1.618 levels are seen as medium and long-term targets:


• 1.272 Fibonacci Level: ~840 USDT


• 1.618 Fibonacci Level: ~1000 USDT


These levels can be considered as resistance areas.



Support and Resistance:


• Support Levels:


• First strong support is located in the ~240-260 USDT range.


• The 300 USDT level can be monitored as a short-term intermediate support.


• Resistance Levels:


• 400 USDT is a strong psychological resistance. Closing above this level could cause the price to move rapidly upwards.



Indicators:


1. Volume: An increase in volume is an important signal for the continuation of the trend. An increasing volume is seen on the chart along with the rising price, which supports the rise of the price.


2. RSI (Relative Strength Index):


• If the RSI is in the overbought region (above ~70), a price correction can be expected. However, if there is a recovery from the overbought region, the trend will continue.


3. Moving Averages:


• Long-term moving averages (e.g. 200-day EMA) are acting as strong support above the price, indicating that the trend is up.



Formations and Formation Reversals:


• Bottom Formation: An accumulation process was seen on the chart throughout 2023, indicating that the price was preparing to break upwards.


• Fibonacci Extension: A strong signal for the continuation of the uptrend. Especially if the 400 USDT level is broken, the 1.272 (840 USDT) target becomes active.



Trend Direction:


• Uptrend: It is clear that the long-term downtrend has ended and the price is moving upwards. Rising lows and highs indicate that the trend is healthy.



Strategy:


1. Buying from Supports: Pullbacks to the 300-350 USDT range can be considered as a buying opportunity.


2. Stop-Loss: If the price falls below 240 USDT, the uptrend may be invalidated. Therefore, a stop-loss can be placed below this level.


3. Objectives:


• First target: 400 USDT


• Second target: 840 USDT


• Long term target: 1000 USDT


4. Risk Management: Positions can be opened by taking a risk of 2-3% of the portfolio.



General Comment:



AAVE seems to have broken its long-term downtrend and entered an uptrend. Fibonacci levels can be used for medium and long-term targets. However, profit taking should be considered at resistance levels and a stop-loss strategy should always be used. If volume and momentum support the rise, higher levels can be targeted.