Aave Price Faces Double-Digit Drop as Bearish On-Chain and Technical Signals Intensify

Aave (AAVE) is currently under bearish pressure, with multiple technical and on-chain indicators signaling a potential double-digit price correction. The token recently retested a previously broken ascending trendline, a move that historically has been followed by further downside. On-chain data from CryptoQuant shows that the Spot Taker Cumulative Volume Delta (CVD) for AAVE has been negative for several weeks, indicating sustained selling dominance [1]. This metric, which compares the cumulative volumes of buy and sell takers over a 90-day period, has been on a downward trajectory since mid-July, reinforcing the bearish sentiment.

Derivatives data also point to a strengthening short position. Coinglass reports that the long-to-short ratio for Aave has dropped to 0.82, the lowest in over a month, suggesting that traders are increasingly betting against the token’s price [1]. A ratio below one typically indicates that the market is leaning toward a downward move, as more capital is allocated to short positions than longs.

The technical outlook aligns with these bearish signals. AAVE’s price broke below a key ascending trendline drawn from early April, dropping 5% over the next two days. Although it found temporary support near the 200-day Exponential Moving Average (EMA) and partially rebounded, it failed to break above the retested trendline [1]. The Relative Strength Index (RSI) currently sits at 40, below the neutral 50 level, and the Moving Average Convergence Divergence (MACD) remains in a bearish crossover, indicating that downward momentum is intact [1].

If the correction continues, AAVE could face additional pressure as it approaches the $242.27 level — the same 200-day EMA it briefly touched in early July. A close below this level could trigger further losses toward the 50% Fibonacci retracement at $225.64. Conversely, a recovery and a strong close above $282.84 could signal a short-term rally toward the July 18 high of $349.23, though such a move would require a clear shift in sentiment [1].

While the immediate outlook is bearish, some analysts have issued more optimistic long-term forecasts. Bitget projects that AAVE could rise to $275.43 by June 2026, assuming a monthly growth rate of 0.42%. However, this forecast is based on a stable or bullish market environment and may not account for the current bearish conditions [2]. Analysts caution that until broader market sentiment improves, such price targets should be treated with caution.

The broader cryptocurrency market is in a state of consolidation, with bulls and bears in a prolonged struggle for dominance. AAVE’s price has been affected by this larger trend, as it remains below both its 50-day and 200-day simple moving averages [1]. Traders are advised to remain cautious, particularly given the conflicting signals from on-chain metrics and technical indicators.

For now, the bearish narrative appears well-supported, with both technical and on-chain data reinforcing the likelihood of further downside. Investors are encouraged to closely monitor key support levels and on-chain metrics for signs of a potential reversal. Until a clear shift in sentiment or structure occurs, the outlook for AAVE remains cautiously bearish [1].

Source:

[1] FXStreet (https://www.fxstreet.com/cryptocurrencies/news/aave-price-forecast-bears-take-control-as-technical-and-on-chain-signals-warn-of-double-digit-drop-202508050539)

[2] Bitget (https://www.bitget.com/price/aave/price-prediction)