Is Aave (AAVE) Poised for a Breakout? This Key Pattern Formation Suggests So!

Key Takeaways

• AAVE is forming a descending broadening wedge on the 4H chart — a bullish reversal structure.
• Strong demand emerged near the $92.69 support zone, triggering a rebound.
• Price is now approaching the upper resistance.
• A confirmed breakout from wedge could open the door toward the $207.31 target (~80% upside).
• The $111 area remains key short-term support if rejection occurs.

The broader cryptocurrency market is staging a strong rebound, with Bitcoin up 4% and Ethereum surging nearly 8% in the past 24 hours. This renewed optimism is lifting several major altcoins.

Meanwhile, Aave (AAVE) is trading slightly in the red today. However, beneath the surface, a developing chart structure suggests that momentum could soon shift in favor of the bulls.

Descending Broadening Wedge Pattern in Play

On the 4-hour timeframe, AAVE is trading within a descending broadening wedge — a pattern often associated with bullish reversals after extended corrective phases. Unlike traditional falling wedges, this structure shows expanding volatility, with price making lower lows and lower highs within widening trendlines.

During the recent pullback, AAVE dropped toward the $92.69 region, where strong demand quickly emerged. Buyers stepped in aggressively at this lower boundary of the wedge, triggering a sharp rebound.

That bounce has now pushed price back toward the $115–$120 area, placing AAVE right near the wedge’s upper descending resistance trendline. The steady climb into resistance suggests growing breakout pressure, as repeated tests of a trendline often weaken it over time.

Importantly, market structure has improved since the rebound, with higher lows forming on lower timeframes — a subtle but meaningful shift in momentum.

What’s Next for AAVE?

The key level to watch is the $120 resistance zone, which aligns with the wedge’s upper boundary.

• A decisive breakout and strong close above this region would confirm the bullish wedge breakout.
• In that case, the measured move projection opens the door toward $207.31, representing roughly 80% upside from current levels.

Such a move would mark a major trend shift and likely attract fresh momentum traders and sidelined buyers.

However, if AAVE faces rejection at resistance, price may continue consolidating within the wedge. In that scenario, the $111 region becomes an important short-term support zone. Holding above this level would maintain bullish pressure and keep the breakout thesis alive.

For now, the structure favors a potential upside resolution — but confirmation above $120 will be the trigger that traders are waiting for.