AAVE's Overbought Rally Hits Ceiling Test

AAVE's recent price action has been impressive, but technical indicators are now signaling that the asset may be overbought and due for a correction. At $180.82, AAVE is trading in extremely overbought territory, with an RSI of 72 and a flat MACD histogram. This suggests that the momentum driving the rally has run out of steam.

The price is also pinned to the upper Bollinger Band, while open interest has dropped by 9.4% over the past 24 hours. These signals indicate that AAVE may be experiencing a ceiling test, and that buyers need to show conviction to push the price higher.

Despite these technical warnings, the broader DeFi sector has been gaining institutional attention in Q3 2026, and AAVE has been one of the prime beneficiaries. However, sentiment can only carry a trade so far before the chart demands a reckoning.