AAVE Price Drops After Record Liquidations – Time to Buy?

AAVE Price – What It Means for the Market

AAVE Price– Aave [AAVE] has experienced a major liquidation event in the past 24 hours, with total liquidations exceeding $200 million. This marks the largest liquidation on the platform since August 2024, highlighting a surge in market volatility.

These liquidations account for approximately 30% of all liquidations recorded on Aave to date. Despite the magnitude of the event, Aave’s system has successfully prevented a major rise in bad debt, which has instead declined. According to recent data, the total amount liquidated stands at around $369,580, indicating that while the event was severe, the overall health of the platform remains robust.

Will Diagonal Support Hold for a Rally?

Aave’s price has faced a significant downturn, dropping by 5.12% to a current trading value of $259.34. The cryptocurrency is encountering a strong resistance level at $360.00, while key support is positioned at $230.00. This setup suggests that AAVE’s price could fluctuate further in the coming days.

Technical indicators suggest a gradual build-up of support at lower levels, potentially providing a foundation for recovery if the market stabilizes. AMBCrypto’s analysis indicates that AAVE has been moving within a price channel, with strong resistance forming at $360.00. The presence of diagonal support and resistance lines suggests that AAVE might experience a corrective upward movement if market conditions improve.

Liquidation Breakdown and Network Stability

The recent liquidations occurred amid growing concerns over broader market sentiment. Notably, the Aave v3 Ethereum [ETH] market accounted for liquidations totaling $205,443,590.

Despite the high liquidation figures, Aave’s network remains fundamentally stable. The platform’s total value locked (TVL) currently stands at $18.3 billion, reflecting its ability to maintain liquidity even during volatile periods. Moreover, while a growing number of wallets are now eligible for liquidation, Aave’s effective collateral management has contributed to a reduction in bad debt, further reinforcing its resilience.

Bulls vs. Bears: Who Holds the Upper Hand?

Investors are currently navigating a turbulent market, as reflected in Aave’s recent price action and the spike in liquidations.

While market sentiment remains divided, Aave continues to hold a significant position despite the broader downturn. Over the past few weeks, bullish and bearish forces have been relatively balanced, with bulls slightly outnumbering bears. Looking ahead, AAVE’s price movement will largely depend on whether the platform can sustain its support levels and absorb market fluctuations.

As market conditions evolve, traders and investors will closely monitor technical indicators and macroeconomic factors to assess Aave’s potential for recovery or further downside movement.

Disclaimer: This article is for informational purposes only and does not constitute investment advice. Cryptocurrencies and stocks, particularly in micro-cap companies, are subject to significant volatility and risk. Please conduct thorough research before making any investment decisions.