The price of Aave is approaching a crucial technical level as the community behind the protocol prepares for a governance decision that could expand its presence in decentralized finance.
At the time of writing, AAVE was trading around $118.23, gaining 3.1% in the past 24 hours. The token is currently hovering near the upper end of its weekly range between $105.64 and $124.89. Over the past week, AAVE has climbed roughly 12%, though it remains 7% lower over the last month and still 45% down compared to a year ago.
While the price has shown signs of recovery, derivatives activity has cooled slightly. According to data from CoinGlass, trading volume dropped 28% to about $373 million, while open interest stands near $194 million, reflecting a minor 0.09% decrease.
Community Vote Could Expand Aave’s Reach
One factor drawing attention to AAVE right now is an ongoing governance proposal from the Aave DAO. The community is voting on whether to deploy Aave v3 on Monad, a network designed for high-throughput decentralized finance applications.
The vote appears to have strong support. With roughly 21 hours remaining, more than 873,000 participants have voted in favor of the proposal, and no votes have been cast against it so far.
The proposal, originally submitted on Feb. 24, suggests bringing Aave’s lending protocol to the Monad network. Monad’s architecture focuses on speed and efficiency by processing transactions in parallel and combining execution with consensus. This approach aims to deliver faster transactions and lower latency while still remaining compatible with Ethereum development tools.
Supporters believe these features could benefit fintech platforms and on-chain neobanks that require quick settlement times, predictable costs, and deep liquidity. If the deployment goes forward, Aave could become a core lending infrastructure on the network, supporting services such as savings accounts, credit lines, stablecoin liquidity, and treasury management tools.
If approved, a mid-to-late March launch is being considered. The proposal also includes plans to strengthen liquidity by purchasing 10 million GHO tokens and allocating $15 million in incentives from the Monad Foundation.
Aave Price Faces a Key Technical Test
From a technical perspective, AAVE is attempting to recover after several weeks of selling pressure. The token is currently testing resistance around $118–$120, which aligns with the 20-day moving average and the mid-Bollinger Band.
Earlier in February, AAVE dipped close to the $100 support level, briefly touching the lower Bollinger Band before buyers stepped in. That rebound pushed the price back toward the mid-band, which now acts as a critical resistance level.
If the price breaks above $120, momentum could increase and potentially push AAVE toward the upper Bollinger Band near $130. On the other hand, if the resistance holds, the token may pull back toward $108–$110, closer to the lower band.
Momentum indicators are gradually improving. The relative strength index (RSI) has climbed from near the 30 level, which signals oversold conditions, and is now approaching 50, suggesting that selling pressure is easing even though strong bullish momentum has not fully developed.
Meanwhile, narrowing Bollinger Bands point to declining volatility, a pattern that often precedes a significant price move. If volatility expands upward, the next resistance zone could appear around $130–$135. A downward move, however, might push AAVE back toward the $100–$105 range.
For now, the market is watching closely as AAVE sits at a critical turning point. A decisive break above the 20-day moving average could signal a stronger recovery, while rejection at this level may lead to another test of key support.\
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