Aave (AAVE) has demonstrated notable performance but also faced recent fluctuations. With a potential golden cross on the horizon, traders are closely monitoring whether this technical pattern will drive further gains for the altcoin.

AAVE’s Recent Performance and Market Sentiment

Last week, AAVE ended on a positive note, but it has encountered a slight downturn in the past 24 hours. At the time of writing, AAVE was trading around $112.37, reflecting a daily increase of over 1.30%. Despite this recent dip, the token’s overall performance over the past week has been strong, marking an 18% increase and positioning it as one of the top gainers.

Mixed Technical Signals

Current technical indicators for AAVE present a mixed picture. The long-term and short-term moving averages, which are crucial for assessing price trends, are showing supportive levels at approximately $99.86 and $97.67, respectively. This suggests a solid base for the token’s price, offering potential support if the market experiences further volatility.

The Relative Strength Index (RSI), a measure of momentum, stands at 60.76. This value indicates that AAVE is in bullish territory but not yet overbought, leaving room for potential upward movement before reaching overbought conditions, which are typically above 70.

Similarly, the Moving Average Convergence Divergence (MACD) line is currently at 1.32, with the signal line at 1.60, both residing in positive territory. This alignment is generally seen as favorable for the asset’s price, suggesting the potential for continued gains.

The Golden Cross: A Bullish Signal?

Aave is approaching a technical milestone known as a golden cross. This pattern occurs when the short-term moving average crosses above the long-term moving average, often interpreted as a strong bullish signal. If AAVE continues its upward trend, this pattern could become a reality, potentially leading to further gains.

The next significant resistance level for AAVE is around $120. This price point has previously acted as a psychological barrier. Should AAVE manage to break through this resistance, the subsequent target could be around $130, aligning with a previous high and serving as the next logical resistance zone.

Support Levels and Potential Risks

Despite the optimistic indicators, traders should remain cautious. If AAVE experiences a pullback, it could find support around the long moving average at $99.86 and the short moving average at $97.67. A break below these levels could signal a shift back to bearish sentiment, with potential downside testing the $90 level, where previous support was established.

Holder Sentiment and Market Value

Analysis of AAVE’s 30-day Market Value to Realized Value (MVRV) ratio reveals that holders are currently profitable. As of August 19, the MVRV stood at approximately 10.45%, indicating that holders who purchased AAVE in the last 30 days are enjoying an average profit of over 10%. A positive MVRV ratio reflects strong market sentiment and suggests that current holders are not only in profit but also confident in the token’s value.

Conclusion

AAVE’s recent performance and the potential formation of a golden cross present an intriguing scenario for traders and investors. While the technical indicators and the positive MVRV suggest that further gains could be on the horizon, the possibility of short-term volatility remains. Traders should monitor key resistance and support levels closely to navigate the potential ups and downs of AAVE’s price movement.