{"id":448822,"date":"2022-05-18T11:45:00","date_gmt":"2022-05-18T08:45:00","guid":{"rendered":"https:\/\/en.buradabiliyorum.com\/aave-price-risks-a-25-plunge-as-a-classic-bearish-reversal-pattern-emerges\/"},"modified":"2022-05-18T11:45:00","modified_gmt":"2022-05-18T08:45:00","slug":"aave-price-risks-a-25-plunge-as-a-classic-bearish-reversal-pattern-emerges","status":"publish","type":"post","link":"https:\/\/buradabiliyorum.com\/en\/aave-price-risks-a-25-plunge-as-a-classic-bearish-reversal-pattern-emerges\/","title":{"rendered":"# Aave price risks a 25% plunge as a classic bearish reversal pattern emerges"},"content":{"rendered":"<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_84 counter-hierarchy ez-toc-counter ez-toc-custom ez-toc-container-direction\">\n<p class=\"ez-toc-title\" style=\"cursor:inherit\">Table of Contents<\/p>\n<label for=\"ez-toc-cssicon-toggle-item-6a23a3052a760\" class=\"ez-toc-cssicon-toggle-label\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #dd3333;color:#dd3333\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #dd3333;color:#dd3333\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/label><input type=\"checkbox\"  id=\"ez-toc-cssicon-toggle-item-6a23a3052a760\" checked aria-label=\"Toggle\" \/><nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><li class='ez-toc-page-1 ez-toc-heading-level-1'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/buradabiliyorum.com\/en\/aave-price-risks-a-25-plunge-as-a-classic-bearish-reversal-pattern-emerges\/#%E2%80%9D_Aave_price_risks_a_25_plunge_as_a_classic_bearish_reversal_pattern_emerges_%E2%80%9C\" >&#8221; Aave price risks a 25% plunge as a classic bearish reversal pattern emerges &#8220;<\/a><ul class='ez-toc-list-level-2' ><li class='ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/buradabiliyorum.com\/en\/aave-price-risks-a-25-plunge-as-a-classic-bearish-reversal-pattern-emerges\/#Is_AAVE_headed_to_70\" >Is AAVE headed to $70?<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/buradabiliyorum.com\/en\/aave-price-risks-a-25-plunge-as-a-classic-bearish-reversal-pattern-emerges\/#Bearish_headwinds_persist\" >Bearish headwinds persist<\/a><\/li><\/ul><\/li><\/ul><\/nav><\/div>\n<h1><span class=\"ez-toc-section\" id=\"%E2%80%9D_Aave_price_risks_a_25_plunge_as_a_classic_bearish_reversal_pattern_emerges_%E2%80%9C\"><\/span>&#8221; Aave price risks a 25% plunge as a classic bearish reversal pattern emerges &#8220;<span class=\"ez-toc-section-end\"><\/span><\/h1>\n<div class=\"post-content\" data-v-2a0745c6>Technical analysis suggests that a recent uptrend in the price of Aave (AAVE) is showing signs of exhaustion based on early development of a classic bearish reversal pattern.<\/p>\n<h2><span class=\"ez-toc-section\" id=\"Is_AAVE_headed_to_70\"><\/span>Is AAVE headed to $70?<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>Dubbed a &#8220;rising wedge,&#8221; the pattern surfaces when the price rises inside a range defined by two ascending, converging trendlines. As it h<a href=\"https:\/\/buradabiliyorum.com\/en\/category\/download-scripts-themes-apps\/\" data-internallinksmanager029f6b8e52c=\"9\" title=\"Download Scripts &amp; Themes &amp; Apps\" target=\"_blank\" rel=\"noopener\">app<\/a>ens, the trading volume declines, pointing to a lack of conviction among traders when additional buying is needed for continued upside momentum.<\/p>\n<p>Therefore, falling wedges typically result in a bearish breakout where the price breaks below the pattern&#8217;s lower trendline and falls by as much as the maximum distance between the wedge&#8217;s upper and lower trendline.<\/p>\n<p>AAVE has been painting a similar pattern amid its sharp upside move from nearly $61.50 on May 12 to over $93.50 on May 17. If a sustained\u00a0breakdown pans out, AAVE will fall by at least $27, which is the wedge&#8217;s maximum height, as shown in the chart below.<\/p>\n<figure><img decoding=\"async\" src=\"https:\/\/s3.cointelegraph.com\/uploads\/2022-05\/dde1516e-f6ed-49d8-bce2-2180b6b9c9a8.png\" alt=\"\" title=\"\"><figcaption style=\"text-align: center;\"><em>AAVE\/USD four-hour price chart featuring &#8216;rising wedge&#8217; setup. Source: TradingView<\/em><\/figcaption><\/figure>\n<p>This puts AAVE en route to around $70, down about 25% from the current price at $89.20.<\/p>\n<p><strong><em>Related:\u00a0Bitcoin macro bottom &#8216;not in yet&#8217; warns analyst as BTC price holds $30K<\/em><\/strong><\/p>\n<h2><span class=\"ez-toc-section\" id=\"Bearish_headwinds_persist\"><\/span>Bearish headwinds persist<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>The bearish setup for AAVE appears in the wake of the crypto market&#8217;s ongoing strong correlation with U.S. equity markets.\u00a0<\/p>\n<p>The daily correlation coefficient between AAVE and the tech-heavy Nasdaq 100 stood at 0.91 as of May 17, underscoring that the two markets have been moving in a near-perfect tandem. <\/p>\n<p>At the core of their synchronous trends is the Federal Reserve&#8217;s ultra-hawkish monetary policies, including the recent 0.5% hike in benchmark interest rates, against rising inflation.<\/p>\n<figure><img decoding=\"async\" src=\"https:\/\/s3.cointelegraph.com\/uploads\/2022-05\/d79a237d-8657-4c99-a3a1-ca573b209806.png\"><figcaption style=\"text-align: center;\"><em>AAVE\/USD daily correlation coefficient with Nasdaq 100. Source: TradingView<\/em><\/figcaption><\/figure>\n<p>Fear of continued sell-off remains as Wall Street veterans warn about a looming recession. <\/p>\n<p>According to <a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/www.ft.com\/content\/ce305e83-fd33-4ed2-9662-8e04764d83a2\">Lloyd Blankfein<\/a>, the former CEO of Goldman Sachs,\u00a0higher interest rates, coupled with supply chain issues, fresh lockdowns in China and the conflict in Ukraine could keep inflation high. The persistent combination of these factors is likely to make the Federal Reserve keep its hawkish policies and the knock-on-effect is a reduction in U.S. economic growth.<\/p>\n<p>Similarly,\u00a0Michael J. Wilson, Morgan Stanley\u2019s chief U.S. equity strategist and CIO\u00a0<a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/finance.yahoo.com\/news\/top-morgan-stanley-strategist-thinks-171127329.html\">reiterated<\/a> the same catalysts while predicting a 15% decline in the benchmark S&amp;P 500 index. As a result of its correlation with cryptocurrency, AAVE also risks similar downside moves heading further into 2022.\u00a0<\/p>\n<p class=\"post-content__disclaimer\">The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, you should conduct your own research when making a decision.\n<\/p>\n<p><template data-name=\"subscription_form\" data-type=\"markets_outlook\"><\/template><\/div>\n<blockquote><p><strong><span style=\"color: #ff6600;\">If you liked the article, do not forget to share it with your friends. Follow us on\u00a0<span style=\"color: #ff0000;\"><a style=\"color: #ff0000;\" href=\"https:\/\/news.google.com\/publications\/CAAqBwgKMLG0nwswvr63Aw\" target=\"_blank\" rel=\"nofollow noopener noreferrer\">Google News<\/a><\/span>\u00a0too, click on the star and choose us from your favorites.<\/span><\/strong><\/p><\/blockquote>\n<blockquote>\n<p style=\"text-align: center;\">For forums sites go to <span style=\"color: #ff9900;\"><a style=\"color: #ff9900;\" href=\"https:\/\/forum.buradabiliyorum.com\/\" target=\"_blank\" rel=\"noopener\">Forum.BuradaBiliyorum.Com<\/a><\/span><\/strong>\n<\/p><\/blockquote>\n<blockquote>\n<p style=\"text-align: center;\"><strong>If you want to read more <a href=\"https:\/\/buradabiliyorum.com\/en\/category\/news\/\" data-internallinksmanager029f6b8e52c=\"2\" title=\"News\" target=\"_blank\" rel=\"noopener\">News<\/a> articles, you can visit our <span style=\"color: #ff9900;\"><a style=\"color: #ff9900;\" href=\"https:\/\/en.buradabiliyorum.com\/general\/\" target=\"_blank\" rel=\"noopener\">General category.<\/a><\/span><\/strong><\/p>\n<\/blockquote>\n<p><span style=\"color: black;\"><a style=\"color: #ff9900;\" href=\"https:\/\/cointelegraph.com\/news\/aave-price-risks-a-25-plunge-as-a-classic-bearish-reversal-pattern-emerges\" target=\"_blank\" rel=\"noopener\">Source<\/a><\/span><\/p>\n","protected":false},"excerpt":{"rendered":"<p>&#8221; Aave price risks a 25% plunge as a classic bearish reversal pattern emerges &#8220; Technical analysis suggests that a recent uptrend in the price of Aave (AAVE) is showing signs of exhaustion based on early development of a classic bearish reversal pattern. Is AAVE headed to $70? Dubbed a &#8220;rising wedge,&#8221; the pattern surfaces&#8230;<\/p>\n","protected":false},"author":1,"featured_media":448823,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"fifu_image_url":"https:\/\/images.cointelegraph.com\/images\/1200_aHR0cHM6Ly9zMy5jb2ludGVsZWdyYXBoLmNvbS91cGxvYWRzLzIwMjItMDUvMTZjZTAxMDctNjY5ZS00MmRhLTlmOTgtNGYxZDMwZjkyYWNjLmpwZw==.jpg","fifu_image_alt":"","footnotes":""},"categories":[1],"tags":[92664,74867,88119,79806,74863,74868,74939,75150,75164,78261,73785,71407],"class_list":["post-448822","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-general","tag-aave","tag-altcoin","tag-altcoin-watch","tag-analysis","tag-cryptocurrencies","tag-defi","tag-market-analysis","tag-market-update","tag-price-analysis","tag-tech-analysis","tag-markets","tag-trading"],"_links":{"self":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts\/448822","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/comments?post=448822"}],"version-history":[{"count":0,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts\/448822\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/media\/448823"}],"wp:attachment":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/media?parent=448822"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/categories?post=448822"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/tags?post=448822"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}