After climbing to $300 for the first time in four months on June 10, Aave (AAVE) seems to be in trouble again. This time, it is not just about its 20% decline over the past seven days.

Large-volume holders appear to be dumping their tokens, derailing what had looked like an earlier breakout to $400. The move has stoked fears of a deeper correction.

But what does this mean for the AAVE crypto price in the short term? Let’s find out.

Binance Becomes AAVE’s Exit Ramp

Since April 8, AAVE has consistently formed higher lows, culminating in a breakout above $300. This move confirmed a solid uptrend and propelled the altcoin to its highest price since early February.

As of this writing, that is no longer the case, as AAVE’s crypto price has fallen below $230. According to CCN, apart from the broader market decline, crypto whales seem to have contributed to it.

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According to Arkham Intelligence data, one whale sent 15,646 AAVE, worth over $3 million, to Binance. Shortly after, another whale sold 9,290 AAVE for approximately $2.05 million on the same exchange.

If this trend continues, AAVE’s price might find it challenging to retest $300 in the short term. Looking at it from an on-chain perspective, AAVE’s 90-day Mean Dollar Invested Age (MDIA) has seen a notable spike, indicating that older tokens remain dormant and are not being moved or sold.

However, the spike in MDIA also reflects a lack of active trading, which may limit upward momentum for AAVE’s price in the near term.

With fewer tokens changing hands, price acceleration becomes less likely, increasing the probability of consolidation or a short-term correction.

Token too Continue Dropping

The recent shift in exchange netflow volume further validates this short-term bearish outlook. Most of last week, netflows remained in the red, indicating reduced token transfers to exchanges and weakening sell pressure.

However, according to Glassnode data, that trend has reversed. On Sunday, June 22, 25,394 AAVE tokens were transferred to exchanges, indicating potential sell pressure is building.

If this uptick in exchange inflows continues, AAVE’s price could risk breaking below the critical $200 psychological support level, especially if buyer demand does not rise to absorb the excess supply.

AAVE Price Prediction: Recovery Path Not Here

As mentioned earlier, the AAVE crypto price traded in an ascending channel. But it has now broken below the $258.82 support, aligning with the 0.50 Fibonacci retracement level and lower trending of the rising channel

This breakdown indicates that sellers are dominant. Hence, AAVE is likely to fall below the 0.382 Fib level.

In addition, the Relative Strength Index (RSI) is below neutral, indicating bullish momentum. If this trend continues, AAVE’s price might drop below $200, with a potential hit of $180.95.

Conversely, rising buying pressure from whales might invalidate this outlook. In that scenario, the token could break above the upper trendline of the ascending channel and climb toward $400.

Disclaimer:
The information provided in this article is for informational purposes only. It is not intended to be, nor should it be construed as, financial advice. We do not make any warranties regarding the completeness, reliability, or accuracy of this information. All investments involve risk, and past performance does not guarantee future results. We recommend consulting a financial advisor before making any investment decisions.

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