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Aave (AAVE) recently surged by 25.3%, hitting a peak of approximately $102.2 over the past week amidst a broader cryptocurrency market uptrend fueled by Justin Sun’s $21M AAVE and MKR deposit into Binance.
However, the momentum has since slowed, with Aave’s price retracing to around $99.18 as of the latest trading session, marking a 4% decline from its recent high.
Decline in unique AAVE holders
In tandem with this price action, Aave’s Total Value Locked (TVL) within its lending protocol rose to $12.3 billion, up 7.5% week-over-week.
Despite this, data from Santiment reveals a slight decrease in unique AAVE holders, dropping from 168,340 to 167,900 addresses over the same period.
This shift suggests potential changes in investor sentiment or strategic movements among token holders.
📈 Render (RNDR), Aave (AAVE), and Maker (MKR) are the three most notable altcoins seeing address activity rises the past couple of days amongst the many market cap rises. Historically, rising levels of wallets interacting on networks is a sign of future bullish behavior. pic.twitter.com/N60Uxn4XSU
— Santiment (@santimentfeed) July 15, 2024
Simultaneously, Aave’s open interest has surged from $31 million to $55 million recently, indicating heightened market activity and increased participation in leveraged positions or futures contracts linked to Aave.
![](https://invezz.com/wp-content/uploads/2024/07/AAVE-Open-Interest-1024x241.png)
Source: CoinGlass
Why is AAVE’s price dropping?
Market analysts attribute Aave’s recent price decline to the Relative Strength Index (RSI), which entered the overbought territory, triggering short-term profit-taking and price corrections as investors adjust their positions.
Currently, the RSI stands around 43, moving away from overbought conditions and nearing the oversold zone.
![](https://invezz.com/wp-content/uploads/2024/07/AAVE-price-chart.png)
AAVE/USDT H4 price chart
Looking forward, sustaining Aave’s bullish trajectory hinges on the RSI stabilizing below the 50 mark, potentially signaling a rebound when it reaches oversold levels.
However, ongoing volatility in Aave’s price could intensify, particularly in response to significant whale activity or increased liquidation events in the market.
The post Aave price dips 4% post-rally as unique holders decline, analysts eye market sentiment appeared first on Invezz
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The views and opinions expressed in this article are solely those of the authors and do not reflect the views of Bitcoin Insider. Every investment and trading move involves risk - this is especially true for cryptocurrencies given their volatility. We strongly advise our readers to conduct their own research when making a decision.