Crypto Market

Why is the crypto market down today?

The crypto market is down today as the impact of large liquidations temporarily shakes the bulls’ confidence.

The crypto market is down today after a sharp correction hit Bitcoin (BTC), Ether (ETH) and altcoin over the weekend.. Bitcoin price dropped by 6.5%, losing nearly a week of gains in 20 minutes on Dec. 10. 

Opening the week, crypto market price action remains tilted to the downside as investors and money managers further digest the factors behind the abrupt correction.

The decline across major cryptocurrencies has led to a rush of liquidations across the derivative market. Bullish traders were caught off guard, leading to a quick spat of long liquidations.

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Top 7 legal and compliance jobs in the crypto market

Explore essential skills for top legal and compliance jobs in the crypto market.

Cryptocurrencies are a rapidly growing market that is changing how people invest, buy and sell goods and services, and transfer money. However, with the growth of this market comes an increasing need for legal and regulatory compliance, particularly concerning issues such as money laundering, fraud and data protection.

As a result, there is a demand in the cryptocurrency sector for legal and compliance specialists. The positions listed below are just a few examples of the various legal and compliance positions available in the cryptocurrency sector. Each one is crucial to ensuring that the market functions fairly, openly and lawfully.

Compliance officer

A compliance officer in the crypto market is responsible for ensuring that the company complies with all relevant laws and regulations, including Anti-Money Laundering (AML) and Know Your Customer (KYC) requirements. 

Knowing the relevant laws and regulations, having strong analytical and problem-solving abilities, and having the capacity to effectively interact with internal and external stakeholders are all necessary qualifications for this position.

Legal counsel

A legal counsel in the crypto market provides legal advice and support to the company on a range of legal issues, including regulatory compliance, contracts, intellectual property, and data protection.

Legal counsels in the crypto world require unique skills due to the complex and evolving nature of the cryptocurrency market. This also entails technological and legal skills. Legal counsels need to know the rules and legislation that apply to cryptocurrencies and other digital assets, as well as the underlying technologies like blockchain and smart contracts. Additionally, they must be able to handle the dynamic regulatory environment of the cryptocurrency business.

They must also have exceptional analytical and problem-solving abilities to decipher complicated legal and technical data, giving clients clear and succinct advice. Additionally, legal counsels must have strong communication and negotiation skills to represent clients effectively in legal proceedings or negotiations.

Compliance analyst

A compliance analyst in the crypto market is responsible for monitoring the company’s compliance with regulatory requirements, conducting risk assessments, and developing and implementing compliance policies and procedures.

Skills required for this role include strong analytical and problem-solving skills, knowledge of relevant laws and regulations, and the ability to work independently and as part of a team.

KYC/AML analyst

A KYC/AML analyst checks consumers to ensure they adhere to AML and KYC standards in the crypto market. KYC/AML analysts in the crypto market require attention to detail, knowledge of regulations, risk assessment, investigative skills, data analysis, and communication skills to ensure compliance with Anti-Money Laundering and Know Your Customer requirements.

Related: What is KYC, and why do crypto exchanges require it?

Regulatory affairs manager

A regulatory affairs manager in the crypto market is responsible for monitoring regulatory developments, analyzing the impact on the company and developing strategies to ensure compliance. 

Regulatory affairs managers in the crypto industry require skills such as adeptness with compliance frameworks, knowledge of regulatory policies, proficiency in navigating legal requirements and the ability to develop strategic solutions to meet regulatory obligations.

Chief compliance officer

The chief compliance officer in the crypto market is responsible for overseeing the company’s compliance function, ensuring that the company complies with all relevant laws and regulations, and developing and implementing compliance policies and procedures.

Related: How are metaverse assets taxed?

Chief compliance officers in the crypto market require skills such as leadership, stakeholder management, strategic planning, risk assessment, and adeptness with compliance frameworks and regulatory policies to ensure effective compliance management and risk mitigation.

Data protection officer

A data protection officer in the crypto market is responsible for ensuring that the company complies with data protection laws and regulations, such as the General Data Protection Regulation (GDPR).

Data protection officers in the crypto industry require advanced knowledge of privacy regulations, expertise in data governance, proficiency in implementing security protocols, and the ability to ensure data confidentiality, integrity and availability.

Crypto Fear and Greed Index hits highest level since Bitcoin’s all-time high

Sentiment toward the crypto market is the most positive its been since around the time Bitcoin hit its all-time high almost 16 months ago.

The Crypto Fear and Greed Index has hit its highest index score this year, reaching levels not seen since Bitcoin (BTC) posted its all-time high in November 2021.

A March 20 update of the Index showed a score of 68, placing it firmly within the “Greed” territory.

The Index’s score of 66 as shown on March 20. Source: alternative.me

The Crypto Fear and Greed Index aims to numerically present the current “emotions and sentiments” towards Bitcoin and the cryptocurrency market, with the highest score being 100.

The last time the index recorded a score above 66 was on Nov. 16, 2021, just days after Bitcoin’s all-time high of over $69,000 was recorded on Nov. 10, 2021, according to Coingecko.

All time chart of the Index, Nov. 16, 2021, was the last time it recorded a score above 60. Source: alternative.me

Sentiment around BTC and crypto has been bullish since the collapse of Silicon Valley Bank and the resulting fallout in the traditional financial system. 

Over the past seven days, Bitcoin has recorded gains of around 27.8% as per Coingecko data, and hit $28,000 for the first time since June 2022.

Crypto financial services Matrixport’s head of research Markus Thielen suggested in a March 20 analysis that there is more upside on the cards for BTC, as the “liquidity story continues to be in Bitcoin’s favor.” 

The analyst has adjusted his near-term price target to $36,000 by June 2023, while he has tipped a year-end target of $45,000. 

Matrixport head of research Markus Thielen has predicted Bitcoin could be on the way to $36,000 in the next few months. Source: Matrixport

Meanwhile, Charles Edwards, founder and CEO of investment firm Capriole, predicted an even more ambitious price target of $100,000 for BTC. 

In a March 14 tweet, Edwards, called BTC price action in 2023 a “Textbook perfect Bitcoin ‘Bump & Run Reversal”, and based on his interpretation of the data, he thinks “The target is over $100,000.”

However, he did note that, “chart patterns do fail, don’t use this as a trading / investment plan. Manage your risks!”

Ryan Selkis, founder and CEO of crypto analytics firm Messari shared a similar “rough” prediction in a March 16 post, explaining why he thought over the next twelve months it was possible for BTC to hit $100,000. 

According to Selkis, a combination of bank failures and changes to federal monetary polices will see more outside investment into crypto.

 “But the key is threading the needle so institutions can buy it and defend it alongside of us. Best case scenario right now,” Selkis said. 

“This is an optimistic bet on the future, as BTC is treated as a life raft and peaceful exit option,” he added.

Related: Bitcoin stays out of fear for 11 straight days as price tips near 24K

Bitcoin has been ranked by investment firm Goldman Sachs as the top performing asset this year, gaining 51% in year-to-date absolute returns.

Goldman Sachs has revealed Bitcoin has outpaced many traditional investment assets. Source: Goldman Sachs

In a March 17 note, the asset manager revealed Bitcoin’s total returns YTD has outpaced the likes of information technology, gold, the NASDAQ 100 and the S&P 500, among others. 

What is JOMO in crypto trading?

JOMO is that “I-was-right-about-the-market” joyful feeling after narrowly escaping a bad trade and potentially catastrophic losses.

JOMO stands for the joy of missing out — particularly when a cryptocurrency trader refuses to follow the crowd. It’s the opposite of FOMO or fear of missing out, and it’s the counterbalance to price rallies driven by hype and frenzy.

What is JOMO in crypto trading?

In crypto trading, JOMO stems from not following the herd — which is often wrong — and avoiding a potentially significant loss.

For example, the frequent bullish calls in the Bitcoin market during the 2020–2021 bull run likely prompted many people to buy at the top, expecting more upside. 

Many market commentators, including analysts at Standard Chartered and JPMorgan Chase, predicted in 2021 that Bitcoin’s (BTC) price would reach $100,000 by the end of the year. The widely-tracked stock-to-flow model further boosted the bullish argument, given its accuracy through most of Bitcoin’s bull and bear cycles.

However, Bitcoin’s price fell short of its popular $100,000 target after peaking out in November 2021 at $69,000, down 60% since.

BTC/USD weekly price chart. Source: TradingView

Thus, the JOMO traders who either sold or didn’t buy into the rally at the time came out on top. Moreover, they retained the capital to get in at lower levels when FOMO was nonexistent, such as in June 2022, which marked Bitcoin’s latest price bottom. 

JOMO after Bitcoin price peak

Market watcher Michael Gogol was one of the few JOMO traders who didn’t buy into the overly-optimistic Bitcoin predictions in late 2021. He reduced his crypto exposure a month before Bitcoin’s peak, expressing his relief in May 2022.

On the other hand, one trader confessed that he had bought Bitcoin at $60,000 in October 2021 after getting convinced by the market’s anti-inflation narrative. He said:

“The whole inflation thing finally clicked. I panicked and entered almost at ATH of 69k. Feels bad. Went down the rabbit hole, hours of research.“

Turning FOMO into JOMO

FOMO originates from the objective of making money quickly. Many traders believe they can double or triple their investments within a matter of days, weeks or months by investing cryptocurrencies. 

Usually, traders with FOMO may open or close their trades multiple times a day without putting considerable thought or strategy behind them. These high-risk trades also mentally impact traders, even leading to stress and sleep deprivation.

Here are four steps that a trader can take to turn FOMO into JOMO:

  1. Develop a trading plan.
  2. Keep a trading journal to monitor your trading patterns. 
  3. Analyze potential trades using multiple metrics, including fundamental and technical analysis.
  4. Ignore emotions, follow your plan and adjust accordingly. 

This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.

3 reasons why Avalanche (AVAX) price can double by March 2023

The latest AVAX price rally comes on the heels of Avalanche’s partnership with Amazon Web Services as the cryptocurrency market rebounds.

Avalanche (AVAX) has opened 2023 with a bang, rising nearly 55% in the first two weeks. And now, a mix of technical and fundamental indicators hints that the token will keep rallying into March.

AVAX price breakout underway

The AVAX/USD pair appears to have been forming a falling wedge pattern since May 2022 and has now entered the breakout stage of this pattern.

A falling wedge forms when the price trends lower inside a range defined by two converging, descending trendlines. The pattern resolves as the price breaks out of its range to the upside. As a rule of technical analysis, the price can rise as high as the distance between its upper and lower trendlines.

AVAX/USD daily price chart featuring falling wedge setup. Source: TradingView

Applying the theory on AVAX’s falling wedge pattern brings the token’s breakout target at around $34, a 115% increase from current price levels.

Avalanche’s Amazon partnership

AVAX’s bullish setup appears as Ava Labs — the developer of the Avalanche network — becomes an official blockchain solution provider to Amazon Web Services (AWS).

Cast your vote now!

Notably, the firm will implement new features that make it easier for developers to run an Avalanche node through the AWS Marketplace. Additionally, developers can create Avalanche subnets with a few clicks.

The partnership will increase Avalanche’s utility among enterprises and governments in a perfect scenario which, in turn, could boost demand for AVAX tokens. These prospects have helped the Avalanche token rise nearly 30% in a 24-hour adjusted timeframe.

Macro boosts bullish scenario

AVAX’s bullish falling wedge setup emerges amid improving macroeconomic fundamentals for riskier assets, which may benefit the crypto market in the coming months.

According to a Bloomberg survey, economists are positioned for a drop in the United States Consumer Price Index (CPI). Ideally, declining inflation may prompt the Federal Reserve to stop its interest rate hikes, which leaves investors with excess cash to invest in riskier markets.

The next CPI report will come out on Jan. 12. JPMorgan & Chase sees a 20% probability of the S&P 500 index rising by 3–3.5% if the December inflation figure comes in at 6.4%. The index could rise 1.5–2% if the inflation reading comes inside the 6.4–6.5% range, a scenario with a 65% possibility.

JPMorgan’s game plan on CPI day. Source: Bloomberg

Thus, AVAX/USD could rise alongside the U.S. benchmark index on a lowered inflation reading, with a rally continuing at least until the Fed’s meeting on Jan. 31. 

Downside risks remain

Meanwhile, AVAX shows signs of indecision near $15.75, a strong resistance level supported during the June to November 2022 session.

Related: Bitcoin price targets include new $14K dip as Fed’s Powell avoids inflation

If the price fails to close above the said resistance line decisively, the likelihood of a correction toward its next support line near $10.50 increases. The same level was instrumental as support in June to July 2021 session, as shown below.

AVAX/USD three-day price chart. Source: TradingView

In other words, AVAX risks a 35% drop from its current price levels, a move that could invalidate the falling wedge setup altogether.

This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.

Solana joins ranks of FTT, LUNA with SOL price down 97% from peak — Is a rebound possible?

SOL price jumped 20% after falling to its worst level since February 2021 with Solana’s technicals suggesting that more upside is possible.

Solana (SOL), the cryptocurrency once supported by Sam Bankman-Fried, pared some losses on Dec. 30, a day after falling to its lowest level since February 2021.

Solana price down 97% from November 2021 peak 

On the daily chart, SOL’s price rebounded to around $10.25, up over 20% from its previous day’s low of approximately $8. 

SOL/USD weekly price chart. Source: TradingView

Nevertheless, the intraday recovery did little to offset the overall bear trend — down 97% from its record peak of $267.50 in November 2021, and down over 20% in the past week. 

But while the year has been brutal for markets, Solana now joins the ranks of the worst-performing tokens of 2022, namely FTX Token and LUNA, which are down around 98%. 

FTT (red) vs. LUNA (green) vs. SOL (blue) performance since November 2021. Source: TradingView

SOL price could recover 50%

However, the latest Solana price rebound hints at the possibility of more upside heading into 2023.

That is primarily due to Doji — a candlestick pattern that forms when the asset opens and closes near or at the same level in a specific timeframe. SOL formed what appeared to be a “standard Doji” on its daily chart on Dec. 29.

Traditional analysts consider a Doji as a potential reversal candlestick pattern, given it shows that bears and bulls are at a a stalemate. Therefore, from a technical perspective, a Doji formation during a long uptrend period could suggest a bearish reversal in the making, and vice versa.

SOL’s Doji has appeared after a long downtrend period, as shown in the daily chart below. That, coupled with the token’s oversold (relative strength index reading, suggests that an extended bullish reversal may happen in 2023.

SOL/USD daily price chart featuring Doji candlestick pattern. Source: TradingView

SOL’s primary upside target looks to be around $15, up over 50% from current price levels. The $15 level has served as resistance since Nov. 13, 2022. 

Battling negative fundamentals

Solana has emerged as one of 2022’s worst-performing cryptocurrencies, with its year-to-date losses near 97%. In comparison, the total cryptocurrency market cap has dropped onl 65% in the same period.

Related: ‘Everything bubble’ bursts: Worst year for US stocks and bonds since 1932

Several reasons could explain SOL’s underperformance in 2022 such as a hawkish Fed, Solana’s recurrent downtimes, a $200 million hack on one of its associated wallets, and probable FTX exposure.

Earlier in December, Anatoly Yakovenko, the co-founder of Solana Labs Inc., clarified that nearly 80% of projects on Solana’s blockchain had no exposure at all to FTX, stating that there’s more to their platform than the defunct crypto exchange.

This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.

What is crypto market capitulation and its significance

Cryptocurrency market capitulation revolves around investors’ fears of further losses in a seemingly never-ending downward spiral, but it’s also the period of maximum opportunity.

Capitulation literally means concede. In the financial sphere, this term reflects a period of aggressive selling when the last of the bulls concede defeat to become bears themselves.

What is crypto market capitulation?

Suppose a cryptocurrency drops 30% overnight. An investor is left with two options: they can continue to hold or sell to realize the losses.

There would be sharp decline in price if most investors decide to realize their losses. In addition, this selling pressure could produce a price bottom as the bears eventually run out of coins to sell. 

But while it’s very difficult to predict and identify capitulation, there are a few recurring market signals that can help traders prepare for such an event.

A crypto market capitulation will typically include most of these condition:

  • Rapid price crash
  • Large trading volumes
  • Oversold conditions
  • High volatility
  • A big drop in the number of large holders
  • Negative market fundamentals

For example, the sudden collapse of the FTX Token (FTT), the native asset of the defunct crypto exchange FTX, in November 2022 accompanied most signs of capitulation, as shown in the chart below.

FTT/USD daily price chart. Source: TradingView

Cryptocurrencies, especially those with extremely low market caps and liquidity, will always see greater volatility during capitulation. But crypto market capitulations are not always bad for investors. On the contrary, they bring the period of maximum profit opportunity as the asset price bottoms out. 

But crypto market capitulations are not always bad for investors. On the contrary, they bring the period of maximum profit opportunity as the asset price bottoms out. 

For instance, Bitcoin (BTC) and Ether (ETH) have witnessed several market capitulation events in the past eight years, accompanied by large sell-volumes and price bottoms, such as the market crash of March 2020

What is the significance of a crypto market capitulation?

Many experienced traders and investors see a crypto market capitulation as a foreteller of a price bottom. As a result, they prefer to accumulate during a declining market, thus absorbing the sell-side pressure and creating grounds for a potential bullish reversal ahead. 

Related: Here’s 3 ways the relative strength index (RSI) can be used as a sell signal

In addition, a crypto market capitulation typically removes short-term sellers and gradually shifts the momentum to entities with a long-term upside outlook since almost everyone who was going to sell has already done so.

This is typically reflected in a consistent rise of Bitcoin supply held by addresses for more than six months, dubbed “old coins.” 

Bitcoin old supply last active > 6m. Source: Glassnode

These coins are less likely to be spent on any given day, finds a Glassnode research, noting:

“Old Coins typically swell in volume during bearish market trends, reflecting a net transfer of coin wealth from newer investors and speculators, back towards patient longer-term investors (HODLers).”

Ultimately, timing a market bottom during a capitulation event is extremely difficult as the process can take months, if not several years as with Bitcoin in 2014-2016.

Traders typically rely on historic data and previous market bottoms to anticipate potential capitulation events using a myriad of metrics and indicators.

This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.

Web3 devs ‘more active than ever’ amid crypto winter: Report​​

Consecutive all-time-high smart contract deployments and surging usage of Web3 script libraries mean that Web3 devs are still busy working despite the prolonged market downturn.

Web3 developers don’t appear to be fazed by the crypto bear market, with one Web3 platform suggesting they’re “more active than ever” — particularly on the Ethereum network.

In a new Q3 2022 report on Oct. 13 by Web3 development platform Alchemy, the company said that 2022 could be the “biggest year yet” for Web3 developers.

Around 36% of all smart contracts ever deployed and verified on the blockchain have been in 2022, a count of nearly 118,000 compared to the over 323,700 ever deployed, according to the report.

This is despite the price of Ether (ETH) falling by nearly 66% since the start of the year and the total value locked in decentralized finance (DeFi) protocols falling around 70% year-to-date, according to DappRadar.

Nonfungible token (NFT) trading volumes have also taken a beating, decreasing by 98% since late January.

Alchemy states the deployment of smart contracts increased by 40% from the first quarter of the year with consecutive all-time highs hit every month over the third quarter peaking at 17,376 in September alone.

Monthly verified smart contracts in Q3 2022. Image: Alchemy

The data also shows smart contract deployments increased by 143% compared to the third quarter of 2021, reaching over 48,500 for the third quarter of 2022.

Alchemy noted that in the two weeks following Ethereum’s Merge — when the blockchain moved from a proof-of-work to proof-of-stake consensus — smart contract deployment increased by 14%, suggesting some developers may have been waiting for the event to launch their projects.

The company also analyzed the usage of two Web3 script libraries, Ethers.js and Web3.js, which allow developers to read blockchain data and build Web3 products.

The team found the number of developers installing either library had increased by three times that of Q3 2021 to over 1.5 million downloads on average per week.

Related: Demand for talent in crypto less dependent on market as industry matures

Although some have claimed this current crypto bear market is a good time to build products in Web3 that hasn’t always been the case in previous cycles.

As evidenced in Alchemy’s data, the 2017 to 2020 bear market saw a 45% decline in smart contract deployments in the middle of the cycle, from 2018 to 2019, although so far that metric has increased by 50% this year from 2021.

Ethereum Merge to ‘swamp’ other coins with miners — Mining CEO

The Ethereum Merge could force many crypto miners to give up and abandon their expensive mining rigs amid a race to the bottom for profits.

The Ethereum network’s transition from a proof-of-work (PoW) consensus is likely to flood the crypto industry with out-of-work Ether (ETH) miners, causing severe disruption to all PoW tokens. 

Speaking to Cointelegraph, Andy Long, CEO of Bitcoin miner White Rock believes the upcoming Ethereum Merge will force PoW miners to look for greener pastures, such as other PoW blockchains, and thus “swamp” other coins — increasing mining difficulty and reducing profitability, stating:

“As GPU miners point their hardware at other chains their difficulty will increase causing lower returns and splitting the reward amongst more miners.”

Long added that the migration will likely force many crypto miners to give up and abandon their expensive mining rigs.

“Hash rate will flow to alternative GPU PoW coins, and many miners will simply give up and try to sell off their farms of cards,” he said.

“Some miners will try to sell their High-Performance Computing (HPC) or GPU cloud services and will likely fail since there’s too much capacity chasing a limited amount of demand,” he added. 

GPU prices and demand have already been declining as a result of falling Bitcoin (BTC) prices, leading to some cards selling for below the list price and sellers struggling to offload their mining rigs and cards for inflated prices.

Regardless of what happens after the Merge, Long says he is “not strongly opposed” and is interested to see “how market forces play out.”

“When I was building GPU farms in 2017 the Merge was cited as an imminent threat and would have been much more impactful then:”

“There will always be GPUs mining some GPU optimized chains, but I doubt we will return to the levels of revenue seen in ETH proof-of-work at its peak ever again.”

Ethereum is expected to transition to a proof-of-stake (PoS) mechanism between September 10-20 and is considered one of the most significant upgrades in the crypto market this year.

Related: Largest Ether mining pool Ethermine opens new ETH staking service

However, there are still many cryptocurrencies set to continue along their PoW path, including BTC, Litecoin (LTC) and Bitcoin Cash (BCH), as well as Ethereum Classic (ETC), Monero (XMR), Zcash (ZEC) and Ravencoin (RVN).

White Rock Management is a Switzerland-based digital asset technology company that mines cryptocurrencies through data centers located in Texas and Sweden. 

DeFi token AAVE faces major correction after soaring 100% in a month

More than 50% of AAVE’s recent gains appeared after Aave Companies proposed to launch a native stablecoin.

The price of Aave (AAVE) has more than doubled in a month, but its bullish momentum could be reaching a point of exhaustion.

AAVE price tests key inflection level

Notably, AAVE has surged by over 103% after bottoming out locally at $45.60 on June 18, hitting almost $95.50 this July 15. Nevertheless, the token’s sharp upside retracement move has brought its price closer to the level that triggered equally sharp pullbacks since early June.

In other words, AAVE has been testing an ascending trendline resistance that constitutes a “bear flag,” a bearish continuation pattern. For example, the trendline’s previous test on July 9 ended up in a 20% downside move. Similarly, a similar attempt on June 24 pushed AAVE price lower by nearly 30%.

AAVE/USD daily price chart. Source: TradingView

As a result of this distribution behavior, AAVE’s ongoing attempt to break above the flag trendline could meet with extreme selling pressure. A pullback could then see AAVE/USD retest the flag’s lower trendline near $67.75 as its downside target by September, down almost 30% from July 15’s price. 

Meanwhile, the $76.30-level serves as interim support, primarily due to its history as a price floor in May that preceded a 60% rebound move.

Bear flag breakdown scenario

As a rule of technical analysis, the breakdown below $67.75 could see AAVE plunging by as much as the height of the “flagpole” that formed before the bear flag. That would have the token eye $35.50 as its bear flag profit target, down over 60% from the current price.

AAVE/USD daily price chart featuring ‘bear flag’ breakdown setup. Source: TradingView

Conversely, a continued rebound move above the bear flag’s upper trendline would invalidate the breakdown setup. In this case, the bullish target for AAVE will likely be the $115–$120 range that served as resistance in June.

GHO stablecoin

More than half of the gains during AAVE’s price rally have come after its proposal to launch a U.S. dollar-pegged stablecoin called GHO.

Related: UNI, MATIC and AAVE surge after Bitcoin price bounces back above $20K

On July 7, Aave Companies, a centralized entity that backs Aave’s lending protocol, requested its community to vote on their “overcollateralized” stablecoin proposal. AAVE’s price surged by over 53% afterward, led by speculations that GHO would boost the DeFi token’s adoption.

However, any further gains would risk pushing AAVE into “overbought” territory with its daily relative strength index (RSI) treading just five points below 70 as of July 15

AAVE/USD daily relative strength index. Source: TradingView

Rising above the 70 threshold could push AAVE’s price into a correction phase, likely triggering the bear flag scenario as discussed above.   

The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, you should conduct your own research when making a decision.