AAVE’s Entry Score Assessment for Long Term Investors

AAVE has been fairly unstable for the previous few days. For instance, the price rose to as excessive as $ 448 sooner or later yesterday. However, on the time of writing, it has slipped to $ 373.5. Usually long-time HODLers keep watch over such price drops and see them as a chance to enter the market.

AAVE / USDT price chart | Source: Tradingview

Is now the appropriate time to enter the market? Or will the downward development proceed?

Assess the market scenario

Binance, FTX Derivatives and KuCoin stay the most well-liked exchanges the place market individuals trade AAVE tokens. Funding charges on all of those exchanges are nonetheless comparatively impartial on the time of writing (0.01%, 0.11% and 0.08%, respectively).

Usually, a excessive constructive funding price signifies that market individuals are optimistic. However, the dismal numbers talked about above don’t assist this story.

Open contract | The supply: IntoTheBlock

On the opposite hand, open curiosity (OI) has up to now been falling considerably. The complete worth of all open positions was $ 97.07 million as of August 16, however solely about $ 80 million at press time.

Overall, which means cash has flowed out of the AAVE market prior to now few days. In addition, sellers have additionally left the AAVE market. In reality, solely 8.5k merchants look like lively.

Glimmer of hope

The curve of the FTX derivatives exhibits a contradicting development. If you have a look at the charts, AAVE slipped into the secure on August eleventh, however managed to climb on the thirteenth, however got here again for a short while on the 14th.

For the previous few days the curve has stayed within the space of ​​shopping for lag. Hedging is a scenario the place the futures contract price of an asset is larger than the spot price. If the curve turns north sooner or later, the bearish narrative will finally be invalidated.

Deferred sale (pink) and deferred buy (inexperienced) | The supply: IntoTheBlock

While it’s unattainable to say for certain the place AAVE price is headed at this stage, it ought to be famous that the development has modified.

If the price fluctuates in the identical vary over the following few days, a long-term HODLer would possibly take into account coming into the market.

At residence at residence

According to AMBCrypto

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