Aave launches Stable Vaults—but can AAVE extend its rally?

In a blog post on Thursday, July 9, DeFi giant Aave [AAVE] introduced Stable Vaults. This infrastructure allows fintechs, wallets, exchanges, and payment providers to embed fixed-rate stablecoin yield into their products.

Possible use cases include neobank embedded savings powered by Aave market, and a payments company letting merchants earn on idle settlement balances, among others, according to the announcement.

The Aave V4 upgrade also drew record deposit numbers, AMBCrypto reported. This has given the AAVE token a positive jolt. The daily trading volume of the token was up 14.5%, and the price was up by just under 3.5% in the past 24 hours.

Here’s why this momentum might be able to push prices another 12% higher.

Should investors buy the Aave move beyond $100?

In short, buyers might be on the wrong side in this battle. Here’s why.

The 1-day chart showed a bearish swing structure in place. A bearish continuation was established in May, when Aave prices slid below the swing low at $85.05 to reach a new low of $57.83.

This downward impulse move was used to plot a set of Fibonacci retracement levels [orange]. At the time of writing, AAVE bulls were battling against the 61.8% retracement level at $95.55.

This resistance was also just below the $100 round-number resistance. On one hand, it appeared that a breach of this level would be bullish confirmation.

Traders’ call to action- Watch out for a trap

Such a rally could prove to be a bullish trap if AAVE fails to reclaim the higher-timeframe resistance levels. The trend on the higher timeframes, such as daily and weekly, were firmly bearish. A continued move up to $105.81, the 78.6% retracement level, is possible.

This is the trap traders and investors should watch out for. Short-term holders might want to use this bounce to exit at a profit.

If the rally continues and breaks the $118.87 swing high, a bullish structural shift would have occurred. Until then, caution would be the safer approach.

Final Summary

• Aave’s Stable Vaults launch adds another fundamental catalyst to the protocol’s growing ecosystem, helping lift short-term sentiment around AAVE.
• However, the higher-timeframe trend remains bearish, meaning any rally toward $100–$106 could face heavy selling unless buyers reclaim $118.87.