- AAVE dropped below $100, confirming a shift toward bearish momentum
- Exchange inflows and rising supply suggest increasing selling pressure
- Key recovery levels sit at $100, $107, and $110 for a potential reversal
Aave (AAVE) has taken a noticeable hit, dropping below the psychological $100 level as the broader market cooled off a bit. Price fell to around $96 at one point, marking a three-week low, before slightly recovering to trade near $97. Even with that small bounce, it’s still down roughly 7.7% on the day, and market cap shaved off over $200 million, which isn’t exactly minor.
More importantly, AAVE slipped under its short-term moving averages, the 9-day and 21-day, and that usually signals something deeper than just a quick dip. It suggests sustained selling pressure, not just panic but maybe a shift in sentiment. The structure, at least for now, leans bearish, and it’s hard to ignore that.
Sellers Take Control as Market Sentiment Flips
As the market pulled back, traders didn’t hesitate, many started exiting positions pretty aggressively. That shift shows up clearly in sentiment indicators too, with the Bulls vs Bears metric flipping negative after staying positive for over a month. That kind of change doesn’t happen randomly, it usually reflects a real shift in control, from buyers to sellers.
Exchange data backs this up as well. Around 79,000 AAVE tokens moved into exchanges compared to roughly 74,000 flowing out, which might not seem huge at first glance, but the direction matters. Netflows have stayed positive for six straight days now, hinting that selling pressure isn’t just a one-off event, it’s been building.
Exchange Activity Signals Growing Sell Pressure
Another piece of the puzzle comes from the Exchange Supply Ratio, which has climbed to a monthly high of 0.137. In simple terms, more tokens sitting on exchanges means more supply ready to be sold, and that often weighs on price. It doesn’t guarantee a drop, but historically, setups like this tend to lean bearish more often than not.
There’s also a subtle psychological factor here, when traders see supply rising on exchanges, confidence tends to fade a bit. That can lead to even more selling, almost like a feedback loop. And right now, AAVE seems to be stuck in that cycle, at least temporarily.
Momentum Indicators Continue to Weaken
Looking at momentum, things aren’t exactly improving yet. The RSI has dropped to around 34, drifting closer to oversold territory, which tells us sellers are still in control while buyers have mostly stepped aside. It’s not fully exhausted selling pressure yet, just getting there slowly.
If this trend continues, AAVE could slide further toward the $92 level before any meaningful bounce happens. That said, if bulls manage to reclaim $100 and hold it, there’s still a chance for recovery. But for a stronger reversal, price would need to push back above the 9- and 21-day moving averages, around $107 and $110, and right now, that feels a bit far off, honestly.
What Needs to Change for a Reversal
At this stage, AAVE is at a bit of a crossroads. Staying below $100 keeps the bearish structure intact, and extended weakness could follow if buyers don’t step in soon. It’s not collapsing, but it’s definitely under pressure, and that pressure tends to build if nothing interrupts it.
On the flip side, reclaiming key levels could shift sentiment fairly quickly, crypto markets do move fast after all. For now though, the path of least resistance seems downward, unless something changes. Traders will likely stay cautious here, waiting for clearer signals before jumping back in.
