Will AAVE succeed in achieving its goals upon the launch of GHO

CoinJiawang reported:
The price trend of AAVE shows potential but is still limited by its upward channel, with RSI levels remaining neutral.
Despite the launch of the GHO token, the increasing forex reserves and the dominance of sellers may suppress the bullish momentum.
The launch of Aave’s [AVAE] GHO token has gained attention throughout the decentralized finance industry, as it raised $31.2 million in funding, becoming the second-largest asset on Chainlink CCIP.
While GHO aims to facilitate seamless cross-chain liquidity, a big question remains: will this development trigger a bullish growth for Aave, or does the market need more impetus to sustain a bullish trend?
AAVE price trend: Can the rebound continue?
AAVE is currently trading at $151.13, down 1.55% at the time of writing. The price hovers around the middle of its Bollinger Bands, indicating consolidation.
The RSI is at 49.29, neutral, not indicating overbought or oversold conditions. Therefore, despite showing potential for a breakout, the price may retrace before any significant rebound.
Trading volume suggests increasing activity
Interestingly, the number of AAVE trades has slightly increased, growing by 0.84% in the past 24 hours to reach 1.662 million transactions. This growth indicates that despite the slight price decline, activity on the network remains stable.
If this trend continues, especially with more users adopting the GHO token, it could become a bullish catalyst for the token. Therefore, sustained growth in trading volume may be crucial in maintaining any bullish sentiment.
Forex reserves: Higher selling pressure on the horizon?
Furthermore, AAVE’s forex reserves have increased by 0.55%, currently standing at 26.578 billion tokens. Higher reserves usually mean an increase in selling pressure as exchanges hold more tokens, possibly in preparation for liquidation.
Therefore, this trend may offset any potential price increases. If forex reserves continue to rise, the risk of increased selling pressure could suppress any immediate bullish breakthroughs.
Liquidation data: Are bears leading?
Looking at the liquidation data, 1.27 million US dollars worth of short positions were liquidated compared to 1.4608 million US dollars worth of long positions. This imbalance suggests that sellers currently have more control in the market.
However, if buyers start narrowing the gap, especially on large exchanges like Binance, this could change the momentum in favor of price increases.
Read more:
Aave’s [AVAE] price prediction
2024–2025
The launch of GHO by Aave provides a hopeful opportunity for a bullish momentum, but factors such as increasing forex reserves and short-term selling pressure may hinder an immediate rebound in the market.
Therefore, despite showing potential, market conditions must improve for sustained upward breakthroughs to occur.