Aave (AAVE) has recently witnessed significant buying activity from large investors, commonly referred to as "whales." According to Lookonchain, these whales have been purchasing millions of dollars' worth of AAVE tokens since August 20th.
One notable whale made headlines by acquiring AAVE tokens valued at $10.4 million in less than 24 hours.
This accumulation trend among major addresses initially appeared to be a positive indicator for AAVE. However, the token's price faced a strong rejection at the $140 resistance level, which had marked a local high back in March.
Crypto analyst Ali Martinez highlighted on X (formerly Twitter) that the TD Sequential, a technical analysis tool, flashed a sell signal on AAVE’s daily chart. Historically, this signal has been followed by an average 27% drop.
If such a correction materializes, AAVE could potentially decline to the $100 mark.
Despite the bullish structure and momentum observed on the daily timeframe, along with the On-Balance Volume (OBV) reaching a new high indicating strong buying pressure, AAVE still struggled to break past the $140 resistance level.
Further technical analysis revealed that Fibonacci levels drawn from the July rally suggested $142.58 as the 100% extension of that move, reinforcing the strength of the resistance at this level.
Moreover, the 30-day Market Value to Realized Value (MVRV) ratio was at its highest since early March, indicating that short-term holders were in profit. This could result in increased selling pressure. Additionally, the mean coin age has not shown a consistent trend over the past month.
Interestingly, the falling mean dollar invested age has been seen as a positive sign. This trend suggests increased token circulation and new investments, which is considered bullish.
As a result, a potential retracement to the $105-$115 range, followed by a rally, seems plausible for AAVE.
