AAVE (LEND) is among the most capitalized DeFi tokens. After a remarkable 5,000% run, the coin seems to be in a correction phase, which provides an excellent entry opportunity for investors looking to increase their DeFi holdings.
Recap: AAVE is an open-source and non-custodial protocol that allows clients to borrow and lend a wide range of cryptocurrencies with variable and stable interest rates. AAVE has a unique system that allows for rate switching, enabling clients to switch between "stable" and "variable" interest rates. The platform's native token "LEND" provides discounted fees for holders. The platform uses 80% of the fees earned from borrowing to burn LEND tokens. This process leads to an increase in demand and a decrease in supply.
LEND on the Chart
The token reached its all-time high on August 26th, 2020, when it peaked at $0.9. However, the coin has lost 30% of its value over the past week.
LEND is particularly volatile and has had several corrections this year, ranging from -30% to -70% in March this year. We have identified three main support levels where the coin may bounce:
Support 1 $0.5: This level was the resistance when AAVE hit its previous all-time high in January 2018. It has been briefly tested as a support level in August 2020. It now stands at -44% from the current all-time high. The token has just touched upon this support level, whether it will hold or not remains to be seen.
Support 2 $0.38: This level was an important resistance throughout July, which caused LEND to crash more than 40% after reaching it. It stands at -57% from the all-time high.
Support 3 0.2$: This support level helped the token bounce after its previous correction, and it currently stands at -78% from the all-time high.
Although we can never tell for sure in the Crypto market, at least one of these support levels will likely hold and make the token bounce. The token previously crashed and lost 99% of its value when it dropped from $0.5 to just $0.003 in 2018. However, the probability of a devastating correction is significantly lower now due to the improved fundamentals and DeFi momentum.
Recap: AAVE is an open-source and non-custodial protocol that allows clients to borrow and lend a wide range of cryptocurrencies with variable and stable interest rates. AAVE has a unique system that allows for rate switching, enabling clients to switch between "stable" and "variable" interest rates. The platform's native token "LEND" provides discounted fees for holders. The platform uses 80% of the fees earned from borrowing to burn LEND tokens. This process leads to an increase in demand and a decrease in supply.
LEND on the Chart
The token reached its all-time high on August 26th, 2020, when it peaked at $0.9. However, the coin has lost 30% of its value over the past week.
LEND is particularly volatile and has had several corrections this year, ranging from -30% to -70% in March this year. We have identified three main support levels where the coin may bounce:
Support 1 $0.5: This level was the resistance when AAVE hit its previous all-time high in January 2018. It has been briefly tested as a support level in August 2020. It now stands at -44% from the current all-time high. The token has just touched upon this support level, whether it will hold or not remains to be seen.
Support 2 $0.38: This level was an important resistance throughout July, which caused LEND to crash more than 40% after reaching it. It stands at -57% from the all-time high.
Support 3 0.2$: This support level helped the token bounce after its previous correction, and it currently stands at -78% from the all-time high.
Although we can never tell for sure in the Crypto market, at least one of these support levels will likely hold and make the token bounce. The token previously crashed and lost 99% of its value when it dropped from $0.5 to just $0.003 in 2018. However, the probability of a devastating correction is significantly lower now due to the improved fundamentals and DeFi momentum.