$AAVE retraces as DeFi tokens cool after recent strength. This correction aligns with normal rotation cycles where capital temporarily leaves higher-beta sectors. Lending protocols historically recover once risk appetite returns. The drop appears technical rather than fundamental, with long-term holders still active. If market sentiment turns positive, AAVE often leads DeFi recovery waves. Support defense will be key — holding here could trigger renewed confidence across DeFi assets. A breakdown, however, may extend sideways consolidation before the next expansion phase.
