AAVE Technical Analysis Feb 23

[ENGLISH: AAVE’s current market structure is dominated by a downtrend; LH/LL formation continues, but BOS above $116.84 could signal an upside.]

Market Structure Overview

AAVE’s current market structure clearly indicates a downtrend. The price has abandoned the higher highs/higher lows (HH/HL) structure and transitioned to a lower highs/lower lows (LH/LL) formation. The current price is at $114.27 with a 24-hour change of -2.95% negative. This structure is supported by 10 strong levels across 1D, 3D, and 1W timeframes: 2 supports/3 resistances on 1D, 2 supports/1 resistance on 3D, 2 supports/2 resistances on 1W. Supertrend signal is bearish (resistance at $143.59) and trading below EMA20 ($122.93), reinforcing the short-term bearish structure. RSI at 40.04 is in the neutral-lower zone, MACD histogram is positive but overall momentum is weak. Market structure analysis requires preservation of LH/LL for trend continuation and a search for CHoCH (Change of Character) for a change.

Trend Analysis: Uptrend or Downtrend?

Upward Trend Signals

Limited bull signals exist within the downtrend. Positive MACD histogram suggests short-term momentum recovery. Critical $110.45 support level (score 77/100) must hold for higher lows formation; a bounce from here could retrigger HH/HL structure. However, as long as price remains below EMA20 ($122.93), these signals remain weak. Potential bull continuation target is $163.26 (score 31), but speculative without LH/LL break.

Downward Trend Risk

The dominant LH/LL structure confirms the downtrend: lower highs continue as long as we stay below the last swing high $136.26 (score 76/100). Price tested $116.84 resistance (score 68/100) but failed to break it, increasing bear pressure. A drop below $110.45 strengthens lower lows and brings bearish breakdown target $60.99 (score 22) into play. 24h range $111.30-$119.80 reflects the overall downtrend.

Structure Break (BOS) Levels

BOS (Break of Structure) confirms trend changes. For bullish BOS to break the downtrend structure: close above $116.84 swing high (near resistance, score 68/100), followed by breaks of $123.62 (score 66/100) and $136.26 (score 76/100) to confirm HH/HL. Bearish BOS: close below $110.45 (score 77/100), opening the path to $104.81 (score 66/100). These levels are strong on MTF; 1D/3D/1W alignment increases CHoCH risk. Without BOS, the trend continues – educationally, structure breaks should be confirmed with volume.

Swing Points and Their Importance

Recent Swing Highs

Recent swing highs: $136.26 (main resistance, score 76/100) – peak of the downtrend, key in LH formation. $123.62 (score 66/100) mid-term, $116.84 (score 68/100) short-term test point. LH/LL strengthens as these levels are rejected; break is required for bullish shift. Price at $114.27 near $116.84, monitor BOS.

Recent Swing Lows

Recent swing lows: $110.45 (strong support, score 77/100) – LL defense here. $104.81 (score 66/100) secondary, break accelerates bearish. These points block HL formation; hold gives bull hope but overall structure favors bears.

Bitcoin Correlation

BTC at $64,199 (-4.84%) in downtrend; supports $62,940/$61,102/$49,685, resistances $64,323/$66,606/$68,187. BTC Supertrend bearish and rising dominance create pressure on altcoins like AAVE. If BTC drops below $62,940, AAVE’s LH/LL deepens; above $64,323 brings relief. Altcoin correlation is high – BTC structure dominates AAVE, monitor BTC levels for AAVE Spot Analysis and AAVE Futures Analysis.

Structural Outlook and Expectations

AAVE structure is bearish with LH/LL; consolidation possible between $110.45-$116.84. Bullish invalidation: $116.84 BOS + $136.26 confirmation. Bearish: $110.45 break. MTF levels (10 strong points) maintain structure integrity. RSI/MACD divergence warns of CHoCH – monitor structure, avoid speculation. Educational view: Trend is determined by swing points and BOS; markets change rapidly.