- LEND, the native token of non-custodial lending platform Aave, fell almost 40 percent from its year-to-date top of $0.384.
- The plunge followed a steep 2,000 price rise that occurred amid a hype-oriented boom in the decentralized finance sector.
- Technical indicators, coupled with a rally in proof-of-work tokens, now suggest that the LEND downtrend may continue.
Aave’s LEND token surged by more than 2,000 percent in 2020. But its rally is appearing to come to an end.
After topping at near $0.384 earlier in July, the LEND/USD exchange rate corrected lower by circa 40 percent. As of Monday, the pair had established an intraday low at $0.232, a move that crashed it below its parabolic support for the first time this year.
Aave's native token LEND broke below its long-term parabolic support on Monday. Source: TradingView.com
Traders held the price from falling any deeper below the purple curve, as shown in the chart above. The LEND/USD exchange rate formed a sizeable bearish wick and shortly recovered, indicating that there is still some buying sentiment left near the parabolic support.
But LEND continued to trade in a negative area for Monday.
Part of the reason was Bitcoin and Ethereum, the two leading cryptocurrencies that surged impressively higher into the current session. Incidentally, LEND had surged by 675 percent in the last two months, specifically as Bitcoin and Ethereum consolidated sideways in a narrow trading range.
As demand returned for the top two assets in the final days of July 2020, it prompted LEND traders to offload part of their bullish positions for the relatively more bullish tokens. Against bitcoin, the DeFi token plunged by up to 44.11 percent. At the same time, it corrected lower by as much as 55 percent.
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