AAVE Technicals Point To Buy

As we move past mid-October, some cryptocurrencies remain in a correction phase, which can understandably cause concern for investors.

However, we present an opportunity to strengthen your investment or trading portfolio, particularly with the ongoing bullish trend of AAVE.

Daily time frame analysis

AAVEUSD - 1 Day Time Frame

Market trends are best defined by market structures, which offer precise criteria for sustaining or reversing the trend. In AAVE's case, the price briefly dipped to the level of a higher low, but it ultimately did not close below this key level.

Following this internal dip, the price successfully broke through a resistance zone that had been obstructing the continuation of the bullish structure. From our perspective, this signals a confirmation for buying positions.

Additionally, a Fair Value Gap (FVG) has emerged as a support zone, further solidifying the bullish move. This indicates that the buying force that closed the resistance is stronger than the previous corrective movement.

When to buy AAVE?

To manage risk, the first priority is setting a Stop-Loss order. As shown in the attached chart, the Stop-Loss should be placed at the level of the internal higher low. This setup is unique because, as mentioned earlier, the price came very close to the external higher low, representing an accumulation of liquidity that has yet to be withdrawn.

While confirmation to enter a trade has been established, this unclaimed liquidity should be taken into account. As a result, it's advisable to reduce the total volume of your position slightly to manage risk.

For Take Profit levels, two critical areas of Buy-Side Liquidity are highlighted on the chart, and profit-taking should occur at both levels.