The AAVE token has recorded over 120% growth since mid-April, but a pattern is emerging on the chart indicating potential decline.
What the M Pattern Means for AAVE Price
An 'M' pattern, also known as a double top, occurs when an asset rallies to the same resistance level twice but fails to break higher. This often signals that buyers are losing strength while sellers begin to step in. If the neckline of the pattern breaks, the price usually makes a sharper move lower.
Breaking Down the Aave Chart
The AAVE chart shows two peaks forming near the $330 area. The rejection from this zone suggests that the token may not have enough momentum to break through just yet. Key levels on the chart are $278, $262, and $231. The $278 level stands out as a midpoint support that could temporarily slow down the decline.
Market Outlook and Expectations
The recent growth of AAVE comes as the market cools off after a strong summer run. If the bearish 'M' pattern confirms, it could lead to a significant retraction in price.
The current situation around AAVE's price warrants careful analysis. If the expected 'M' pattern confirms, it may lead to a major correction down to the $230 level.
