In their recent technical analysis of Aave, World of Charts relays insights into the cryptocurrency’s current market position. As the analyst points out, Aave is presently encountering resistance at the upper boundary of a bullish pennant pattern on its chart. What happens next at this trendline will be pivotal in determining the magnitude and direction of Aave’s next move.
Should Aave surge above this critical resistance level, validating the bull pennant breakout, the analyst stresses the likelihood of a sizable price increase. In particular, they foresee Aave easily surpassing the $200 mark in the short term.
The chart examined depicts Aave’s trading activity against USDT on a one-hour timeframe. It illustrates the formation of a bullish pennant following an initial sharp upward movement in price, characterized by converging higher lows and lower highs delineating a resistance trendline. According to the analyst, if Aave thrusts higher from this technical pattern, substantial gains may follow.
Aave has been trading within a contracting range over the past few weeks. it has been forming a pennant pattern on the charts. This could suggest the potential for a continuation of its prior bullish trend.
The pennant pattern is understood to be a continuation formation, which means it hints at the possibility for prices to resume their preceding momentum in the same direction.
For Aave, this would translate to additional upside. However, for the pennant to validate itself as a bullish continuation signal, Aave must first convincingly break above the upper barrier of the pennant’s narrowing range. This boundary has now become a critical price resistance level to break through, according to one analyst.
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If Aave can surge higher and close above this level of resistance, it would substantiate the pennant as a valid bullish formation. Should the breakout from the pennant transpire, the analyst forecasts Aave could extend its ascent.
In fact, the cryptocurrency may reach or exceed the $200 price mark, in their view. Bullish pennants commonly project implied targets by measuring the original price impulse prior to the pennant’s formation and projecting that same magnitude higher from the breakout point.
Given Aave’s historical behavior and the bull pennant’s standard calculations, surpassing $200 is within the realm of possibility should the breakout occur as anticipated based on the chart pattern, per the analyst’s technical analysis.
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Show more +However, if the breakout fails and Aave faces rejection at the pennant resistance, the lower trendline of the pennant will serve as a support level. Additional support can be found in the $150-$160 range, where Aave previously consolidated before its recent bullish push.
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