AAVE Stuck in a High-Volatility Range: Sell the $130 Supply, Target the $122 Demand Retest

AAVE 24H Technical Outlook (based on provided daily + intraday candles)

1) Market state & context (multi-timeframe)

• Current price: $127.17
• Daily structure (Nov → now): AAVE has transitioned from a strong downtrend (Nov highs ~$230 → late Jan/early Feb lows ~$120) into a low-level basing attempt.
• Key recent impulse:
  • Jan 29: close ~$147 after a sharp selloff day (low ~$143)
  • Jan 30: close ~$137 (continuation)
  • Jan 31: capitulation-like candle (low ~$119.90, close ~$128.82) with very high volume
  • Feb 1: close ~$124.24 (follow-through weakness)
  • Feb 2: close ~$128.38 (bounce)
  • Feb 3 (daily so far): high ~$129.87, low ~$121.15, close/current ~$127.17

Interpretation: The late-Jan move looks like a selloff → capitulation → reflex bounce, but trend damage remains and price is still well below prior broken supports (~$147–$160).

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2) Trend & market structure (Dow / swing analysis)

• Daily swing points show lower highs and lower lows into Jan 31.
• Since Jan 31, lows have held above ~$120, but highs are capped near ~$130.
• Nearest structure levels:
  • Support: $121–$120 (Feb 3 low / Jan 31–Feb 2 demand area)
  • Resistance: $129.9–$130.2 (recent intraday/daily highs)
  • Major resistance / breakdown zone: $137–$147 (Jan 30–Feb 3 supply; prior support turned resistance)

Conclusion: Structure is bearish to neutral; only a break and acceptance above ~$130 improves near-term trend.

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3) Volatility & range behavior (ATR-style reasoning)

• Recent daily candles have very wide ranges (e.g., Jan 31 and Feb 3), indicating high realized volatility.
• Feb 3 intraday shows a large swing: drop to ~$121 then rebound to ~$129.

Implication for next 24H: Expect mean-reversion + whipsaw risk; directional trades should be opened nearer range edges (better R/R), not mid-range.

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4) Volume / effort vs result (daily)

• The heaviest volume appears on:
  • Dec 22: strong sell candle (close ~$150) on huge volume
  • Jan 31: huge volume capitulation (low ~$119.9)
  • Feb 2–3: still elevated volume

Reading: Jan 31’s volume suggests seller exhaustion and potential accumulation, but subsequent candles have not yet produced a higher-high sequence on the daily timeframe.

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5) Support/Resistance & supply/demand zones

Demand zone (buyers likely):

• $119.9–$122.0: multiple tests (Jan 31 low ~$119.9; Feb 2 low ~$120.69; Feb 3 low ~$121.15). This is the clearest nearby “line in the sand.”

Supply zone (sellers likely):

• $129.5–$130.2: repeated rejections/failed breakout attempts.
• $137–$138: Jan 30 breakdown and subsequent psychological/structural cap.

Implication: Price is currently inside the middle of the $121–$130 range, slightly closer to resistance than to the main support.

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6) Candlestick & price action (intraday)

From the hourly sequence on Feb 3:

• Early hours: mild drift down from ~$128.4 to ~$126
• Midday: spike up to ~$128.8, then sharp drop to ~$121.3
• Late session: V-shaped recovery to ~$129.1, then fade back to ~$127.3

Interpretation: This is classic short-covering / reflex rally behavior after a liquidity sweep into $121–$123. However, the failure to hold above ~$129 suggests supply overhead and a market still prone to selling rallies.

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7) Fibonacci mapping (using notable swing)

Using the visible selloff swing approx $160 (Jan 28 close ~159.97) → $119.9 (Jan 31 low):

• 38.2% retrace: ~ $135.2
• 50% retrace: ~ $140.0
• 61.8% retrace: ~ $144.7

Price at $127 is well below even the 38.2% level, which supports the view that the bounce is still corrective within a broader down move.

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8) Scenario plan (next 24 hours)

Base case (higher probability): Range → slight bearish bias

• Because $129.9–$130 is repeatedly rejected and price is below major retracement levels, the path of least resistance is:
  • retest of $124–$123, potentially another probe toward $122–$121.

Bull case (requires confirmation): Break and hold above $130

• A clean hourly acceptance above $130.2 could squeeze toward $135 (range expansion), but this is not the dominant behavior in the provided tape.

Bear case (breakdown): Lose $120

• If $119.9–$120 breaks on momentum, downside could accelerate quickly (next psychological area would be ~$110, though not shown in this dataset).

24H directional forecast: Mild downside / consolidation, with a higher chance of revisiting $123–$121 than breaking and sustaining above $130.

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Trade thesis (actionable)

Given current price ($127.17) is closer to resistance ($129.9–$130.2) than support ($121–$122), and the higher timeframe remains bearish/corrective:

• Preferred: Sell (short) on strength into resistance, not at the exact mid-price.

Optimal open (limit)

• Open short: $129.60 (inside the established supply band but below the absolute peak ~$129.87 to improve fill probability).

Take-profit / close

• Close (take profit): $122.20 (front-run the $121–$120 demand zone where bounces have repeatedly occurred).

This targets a mean-reversion move back toward the lower edge of the range.

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Risk notes (important)

• High volatility implies slippage risk; if price instead accepts above $130.2, the short thesis weakens materially (range break).
• This is a 24H tactical view based strictly on the supplied candles (no order book / derivatives positioning provided).