YEREVAN (CoinChapter.com) – Aave (AAVE) and Polygon (MATIC) started 2023 with a bang, surging 70%, and 45%, respectively. As a result of the Bitcoin-led rally, AAVE traded at $86.8 on Jan 27, while the MATIC price stood at $1.09. Moreover, both tokens arrived at crucial resistances that could set the expectations for the upcoming sessions.
AAVE resistance at $90 proved tough
As seen on the chart below, AAVE bulls have been unable to break key resistance at $90 since Jan 17. Notably, the digital asset has been trading in a bearish setup dubbed the ‘descending triangle’ since May 2022. It features a flat support and a descending resistance, which caps upside attempts.
According to the formation, the AAVE coin was expected to break below the support and experience a price drop equal to the maximal triangle height, which would drive the price to practically zero. However, AAVE bulls double down, conquering the said resistance. As a result, the coin retested the trendline as support, strengthening the bullish claim.
As of Jan 27, the trading volumes are declining, which could mean a short-term setback for the altcoin. If AAVE fails to break above $90, the next possible support will stand at approximately $79.
Meanwhile, at the time, Bitcoin remains a strong determinant for the altcoin market, including AAVE and MATIC. If the flagship crypto pushes for another leg up, other digital assets will likely follow.
Also read: Are US and EU Hypocrite While Treating Russia Like “Pariah State?”
Additionally, AAVE bulls have another reason to push for another leg up, as the Aave V3 Ethereum Mainnet Launch has “finally arrived.”
Aave V3 Ethereum Mainnet launch increases the token’s bullish chances.
We are excited to announce that Aave Protocol V3 has been deployed on Ethereum Mainnet, Aave’s first and largest market. V3 is the most significant upgrade to the Aave Protocol to date, and is the result of the Aave community’s relentless pursuit of security, capital efficiency and risk management
read the announcement on Jan 27.
According to the Aave team, they decided to focus on the V3 version due to the exponential growth of the DeFi ecosystem. Also, the version introduced “important new risk mitigation features” and improved capital efficiency.
In just over 2 years since V3 launched, the Aave Protocol has ~$6.5B TVL (Total Value Locked as of January 27th, 2023) across Aave Protocol V2 and V3 markets.
said Aave team.
Needless to say, the Ethereum Mainnet launch might increase AAVE’s bullish chances due to wider adoption and higher user engagement.
Polygon (MATIC) in a rising channel
As mentioned, MATIC traded at $1.09 on Jan 27, after a 45% month-to-date rally. Notably, the digital asset has been trading within a ‘rising channel’ setup since May 2022. It features two ascending trendlines and a significant mid-range that prevents sharp breaks in either direction.
Despite the strong 13% bullish move on Jan 26, the MATIC coin couldn’t break above the channel’s mid-range and retested the line as resistance on Jan 27. Much like AAVE, the trading volumes on the MATIC chart were not convincing.
According to the chart, if the MATIC coin conquers the resistance, the next target would stand at $1.45, the channel’s upper trendline. In case of a further decline, the closest assistance will come from $1.03, or $0.96.
However, even if a short-term setback occurs, on-chain metrics point to a heightened accumulation, which would have a bullish effect on the MATIC price.
AAVE and MATIC whales accumulate
According to the crypto analytical platform Santiment, both AAVE and MATIC whales, i.e., accounts holding a large number of coins, have moved into accumulation. Moreover, the platform noted that the accumulation levels should be “watched closely” as they typically influence the price.
AAVE (+56% 30d price), MATIC (+35%), and DYDX (+94%) have all seen dramatic rises in the amount of whale transactions on their respective networks over the past month. The increased large address interest in these assets should be watched closely.
read the announcement.
Also read: Optimism (OP) Forms New ATH But Rally Unlikely To Sustain.
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