DeFi Altcoin Aave Is Set Up ‘Very Well’ for Next Leg of the Rally Due to These Factors: Investor Arthur Cheong

Venture capitalist Arthur Cheong believes that one decentralized finance (DeFi) altcoin may be gearing up for a massive breakout.

The DeFiance Capital CEO tells his 176,400 followers on the social media platform X that several factors are signaling bullishness for lending platform Aave (AAVE).

He suggests Aave’s open interest (OI), which is the total number of outstanding derivatives contracts for a given asset, may have bottomed after a large decline in the last month.

“AAVE price is holding up very well despite the leverage flush on the perps over the past few weeks:

1. Open Interest at 30 days low, dropped by 50% compared to September 11th.

2. Funding rate negative.

Set it up very well for the next leg of rally.”

A negative funding rate means there are more short positions than long positions on AAVE, which some traders perceive to be a bullish indicator.

He also suggests that that Former President Donald Trump using Aave for the launch of World Liberty Financial, his new DeFi crypto project, may be a bullish catalyst.

“If you tell me in 2020 we will have a former and potential future President of the USA supporting the launch of a separate instance on Aave, even the biggest DeFi bull wouldn’t believe it. But here we are. ‘We tend to overestimate the effect of a technology in the short run and underestimate the effect in the long run.'”

Last month, he said Aave appeared to be breaking out of a multi-year consolidation pattern on the weekly timeframe.

“AAVE is trading at the highest level since May 2022 and seems to be breaking out from a two-year consolidation pattern. Expect ATH (all-time high) reclaim to further solidify DeFi Renaissance.”

Aave is trading for $148.88 at time of writing, up 7.4% in the last 24 hours.

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The post DeFi Altcoin Aave Is Set Up ‘Very Well’ for Next Leg of the Rally Due to These Factors: Investor Arthur Cheong appeared first on The Daily Hodl.