AERO Alert: Is This the Bull Trap Zone? Key Resistance Level Could Spark Reversal

AERO faces its ultimate test at a critical technical juncture—where euphoria meets exhaustion.

The Momentum Cliff

Traders are watching that precise level where previous rallies have faltered. Breakouts look tempting, but history suggests caution. The token's recent surge mirrors classic bull trap patterns—sharp pumps followed by sharper corrections.

Market psychology shifts fast here. Buyers push hard, but sellers lurk just above. One false move triggers cascading liquidations.

Volume tells the real story. Thin buy-side support? That’s the trap setting. Smart money knows when to fade the rally—retail rarely does.

Timing the Turn

Watch for rejection candles and diverging RSI. If momentum stalls here, the drop could be brutal. Bulls need a clean break with volume—anything less is just another 'vibe shift' that ends in tears.

Because in crypto, sometimes the most bullish chart is just a bear in disguise—and Wall Street’s algos feast on hopium.

Key Takeaways

The short-term signals were overall bullish for AERO, and strong demand in August meant that a MOVE past the $1.3-$1.45 supply zone was a possibility. Yet, the market-wide sentiment was muted, and a bullish breakout might be unlikely for now.

Aerodrome Finance [AERO] saw an 8.28% uptick in Open Interest (OI) in the past 24 hours.

Meanwhile, its price was up only 0.6% over the past day. This indicated that sentiment among speculators had shifted strongly bullishly.

Source: Coinalyze

It promised a short-term rally, but the data also presented a warning signal. The Funding Rate turned deeply negative even as prices climbed higher, showing a larger number of traders were willing to go short.

To add to this confusing medley, the spot CVD saw a swift jump in recent hours. Overall, the bullish signals outweigh the bearish ones, but traders should manage their positions carefully.

Bitcoin [BTC] was trading near the $112.4k support, at press time, and ethereum [ETH] has also been bearish over the past week.

Should Aerodrome Finance traders bet on a breakout or a correction?

Source: AERO/USDT on TradingView

AERO managed to poke its head above an early 2025 resistance on the price chart. The DMI showed that a strong uptrend was in progress, with the +DI and ADX both well above 20, at press time.

The A/D indicator also highlighted decent buying pressure in recent weeks, although it has slowed down.

Similarly, the MFI has also slipped lower slightly, following AERO’s inability to breach the $1.4 supply zone.

Source: CoinGlass

The liquidation heatmap showed that Aerodrome Finance prices had just swept  pocket of liquidity above $1.4. While further gains were possible, it appeared more likely that the price would retrace toward $1.2.

With all the differing signals on different timeframes, how should traders view the market?

Simply, a move to $1.2 might not be a bearish outcome. In a few days, a retracement to the $1.1-$1.2 area could offer a buying opportunity.

Meanwhile, a breakout past $1.45 right away might be a bull trap driven by a liquidity hunt.

Disclaimer: The information presented does not constitute financial, investment, trading, or other types of advice and is solely the writer’s opinion