Aave (AAVE) $400 Million RWA Inflows Could Fuel Recovery Toward $390

Aave has seen a significant increase in real-world asset (RWA) deposits, according to Token Terminal, as of Thursday, January 29. The increase in RWA deposits amounts to around $400 million over the last quarter. 

This increase in real-world assets within the decentralized finance sector is a reflection of the growing need for investors to look for alternatives to crypto loans.

Source: Token Terminal X Post

This has been largely fueled by Ripple Labs’ RLUSD and Superstate Inc.’s USCC. As evidenced in the chart provided by 21Shares, there has been immense interest in these stablecoins. 

This is a reflection of a larger market trend towards incorporating real-world assets into DeFi applications. Aave is positioned to be at the forefront of this new market.

Also Read: AAVE Breaks Descending Channel, Eyes $350 as Bullish Momentum Builds

AAVE Eyes Bullish Upside as Falling Wedge Completes

This rise in Aave’s RWA deposits, fueled by the stablecoins, indicates that AAVE is likely to continue its upward trend. AAVE is in the spotlight as technical indicators suggest that there is a chance for a recovery. 

According to the crypto analyst, Daniel Ramsey, as of Thursday, January 29, there is a fully developed falling wedge pattern that is often associated with bullish reversals. 

The price is currently consolidating around a support zone that coincides with an ascending trendline. This indicates that selling pressure is decreasing while buyers are entering the market.

Source: Daniel Ramsey X Post

This technological confluence further supports the argument that there could be an upward retracement if the momentum continues to improve. 

The 390 level is being eyed as the upside target, and Daniel Ramsey believes that the resistance level could return at this point. However, the market sentiment will be the deciding factor for the token in the coming sessions.

AAVE Nears $145 Support as Bears Regain Control

However, as indicated by the 4-H chart represented by TradingView on Thursday, 29th January, it has been seen that there has been a decline in the price of the asset in recent times, as it has fallen to a price of $146.26 from a point near $160. 

The recent candlestick pattern indicates that sellers are dominating the market, driving the token towards a significant support point near $145.

Source: TradingView

The technical indicators also support the idea of bearish momentum. The MACD line has crossed below the signal line. This is an indication that the selling pressure is increasing. Additionally, the histogram is showing increasing negative momentum. 

The RSI has fallen significantly and is now at 30.47. It has reached the near-oversold region. which may hint at a potential short-term bounce if buying interest emerges. However, cautious monitoring is advised for confirmation.

Also Read: AAVE Struggles at $144 Support Despite Strong DeFi Fundamentals