AAVE Price Squeeze Exhausted, Breakout or Pullback Ahead
The price of AAVE surged by 8% in a single day, but according to Jessie Ellis, this is likely a short squeeze rather than a trend reversal. The token's open interest collapsed by 15% as the price rose, leaving it jammed against $104.17 SMA-200 resistance.
The Bollinger Band at $102.02 has been acting as a compression wall, not a launchpad, and AAVE hasn't yet reclaimed its 200-day SMA. The short-term moving average stack is constructive, with price above the 7, 20, and 50-day SMAs, but momentum is visibly stalling.
Blockchain.news has documented similar snap-rally exhaustion patterns in DeFi lending tokens across the mid-2026 rate cycle. The buying pressure behind AAVE's move was reactive, not proactive, with trapped short sellers forced to cover or get liquidated.