Whales are offloading Aave in a massive selloff: will the altcoin withstand the pressure?

Aave has been experiencing significant selling pressure recently, with large whales seemingly leading the charge in offloading their holdings. Over the past five days, Aave (AAVE) has seen a steady decline, with the price dropping approximately 14% from its local high of $158 at the end of October to around $129 at the time of writing. This marks five consecutive red candles on the daily chart since Oct. 31, indicating a persistent downtrend.

While the broader cryptocurrency market has shown some signs of recovery amid U.S. election-related events, Aave’s slight 1.1% rebound today hasn’t been enough to establish a strong bullish trend. The altcoin remains vulnerable to further declines unless it can break through key resistance levels and demonstrate a sustained recovery.

A key factor contributing to Aave’s price slump is the increased selling activity by large investors, or “whales.” According to data from Lookonchain, significant amounts of AAVE have recently been moved to exchanges, signaling that whales are reducing their positions. One prominent wallet (0x7634) transferred nearly $3.39 million worth of AAVE to the MEXC exchange, suggesting an impending selloff. Other substantial transactions include a $1.04 million transfer to Binance, $1.29 million to OKX, and another $1.02 million moved to Binance—all within the past 24 hours.

These large transfers reflect growing uncertainty among major players in the Aave market, contributing to the downward price pressure. If the sell-off continues, it could exacerbate the bearish momentum, further destabilizing Aave’s price in the near term.

As Aave faces this turbulent phase, the ability of the altcoin to survive this sell-off and regain bullish momentum will depend on how it responds to broader market conditions and whether it can shake off the effects of these large whale sell-offs. Without clear signals of recovery and a move past key resistance levels, Aave may remain at risk of further declines.

Can AAVE weather the whale selloff?

Aave has gained 0.66% in the last 24 hours, currently trading at $129.65, but it’s down 15.74% over the past week, with its market cap now at $1.94 billion. The daily chart shows a bearish outlook, with the -DI at 27.6, indicating strong selling pressure, while the +DI sits at a weak 13.8, reflecting low buying interest.

The ADX is at 19.8, signaling a lack of a strong trend, which could lead to a period of price consolidation. If the ADX falls below 20, it could give bulls a chance to push back against the selling pressure.

The price is currently just above the support level at $126.2. A drop below this level could trigger further losses, with the next potential support near $120. On the other hand, to reverse the negative trend, Aave would need to break through the $147.12 resistance level, a 13.5% jump from the current price. Even then, it would face further resistance at $160.04, $168.03, and $180.96.

The question remains: Can Aave find the strength to recover amid the ongoing whale selloff?