Aave Forms Sell Signal That Led To 27% Average Correction Last 4 Times

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As a seasoned crypto investor with a knack for recognizing patterns and a healthy dose of skepticism, I find the recent TD Sequential sell signal on Aave intriguing. Having witnessed the market’s volatility firsthand, I can’t help but remember the old saying, “History doesn’t repeat itself, but it often rhymes.” In this case, the rhyme seems to be a potential drawdown after the setup pattern.

A financial expert has noted that recently, Aave appears to be developing a bearish structure which, on four previous occasions, resulted in substantial decreases in value.

Aave Is Showing A TD Sequential Sell Signal Right Now

In a recent post on X, analyst Ali Martinez has talked about a Tom Demark (TD) signal appearing on AAVE’s one-day price chart. The TD signal here is a well-known technical analysis tool commonly used to identify potential turning points in an asset’s value.

Based on my years of trading experience, I’ve found that one effective method for identifying potential reversals is by using a simple indicator with two phases: setup and countdown. During the setup phase, I focus on counting candles of the same polarity (either red or green) until I reach nine. Once this number is hit, I believe the asset may have reached a point of trend exhaustion, as it could be indicative of an impending reversal. This strategy has served me well in my trading journey, and I continue to find success by keeping a close eye on these two phases.

Sure thing! Here’s one way to rephrase that in a more natural and easy-to-understand manner:

After completion of the initial setup, we move on to the second stage, which is initiated by the countdown. Similar to the first phase, this stage operates differently; instead of counting nine candles, it involves counting thirteen. Once all these thirteen candles are in place, it suggests that the price may have reached another probable peak or trough.

As a crypto investor, I’ve just noticed that Aave has completed the initial phase of its TD Sequential signal recently. The chart, as presented by the analyst, clearly demonstrates this development.

Based on the graph’s pattern, Aave has completed a TD Sequential setup using nine consecutive green candles, suggesting that the coin might have peaked (at least according to this particular indicator).

The TD Sequential indicator has appeared for the cryptocurrency following its impressive market performance, which has surpassed most other sectors in the industry. This surge has resulted in a notable increase of approximately 28% in its value during the last seven days.

The chart indicates that Martinez marked the past four occasions where the asset gave off this specific signal. Noticeably, the value of the coin decreased after each of those instances.

To put it simply, there was an average decrease of 27% in AAVE following these specific signs. If history repeats itself, we might expect a comparable drop for AAVE again in the current scenario.

Recently, there’s been an increase in activity on the Aave network, according to insights from the market analysis platform, IntoTheBlock.

It seems that the significant increase in price has brought about an influx of interest towards this asset, with the number of active addresses reaching its peak in more than a year.

AAVE Price

Following its impressive rally, Aave has broken beyond the $134 mark.

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2024-08-23 04:16