- Avalanche’s network activity witnessed a decline in the last 30 days.
- Though AVAX’s price chart was red, the possibility of a trend reversal was high.
Avalanche [AVAX], like most cryptos, underwent a major price correction over the last few days as the crypto market turned red. Chalk it up to bad timing, but the price plummet took place a week before the blockchain’s upcoming token unlock, which could ring alarm bells for investors.
Realistic or not, here’s AVAX’s market cap in BTC’s terms
Avalanche’s key stats are declining
Notably, Artemis’ data pointed out that Avalanche has been witnessing a decline in its network activity. The blockchain’s daily active addresses also took a southward turn over the last 30 days.
The same trend was seen in its daily transactions until 12 August, after which the graph registered an uptick. The blockchain’s value also plummeted, as evident from the sharp decline in its TVL.
Interestingly, AVAX’s revenue and fees went down, but they did spike on 17 August.
Source: Artemis
Moreover, AVAX’s price action remained bearish as well. According to CoinMarketCap, AVAX was down by more than 14% in the last seven days. At the time of writing, it was trading at $10.68 with a market capitalization of over $3.6 billion.
Additionally, Token Unlocks’ tweet revealed that AVAX is set to unlock 2.77% in the next eight days, which amounts to a staggering $102 million. Generally, when circulating supply increases, the value of the asset registers a decline. However, this was not the case with AVAX.
. $AVAX is set to unlock 2.77% in next 8 days, which amounts to a staggering ~$102 million. 🔓
Looking back at the price impact of the last 5 unlocks from 14 months ago, we observed that the $AVAX price rose during the unlock period continuously. 📉
To delve deeper into this,… pic.twitter.com/k2BXG0UD4R
— Token Unlocks (@Token_Unlocks) August 18, 2023
As per the tweet, AVAX’s price rose during its previous unlocks. However, this time, the possibility of a price drop seemed likely as negative sentiment dominated the market. As per LunarCrush, bearish sentiment around AVAX surged by 63% in the last 24 hours.
Source: LunarCrush
How much are 1,10,100 AVAXs worth today?
Avalanche’s downtrend might end soon
Though bearish sentiment was dominant, a metric suggested a trend reversal. AVAX’s Open Interest declined when its price dropped. A sink in the metric usually means that the ongoing price trend might end soon.
Moreover, Avalanche’s Relative Strength Index (RSI) was in the oversold zone, which could increase buying pressure soon. AVAX’s Money Flow Index (MFI) also went up slightly. Nonetheless, the MACD looked troublesome as it displayed a massive bearish edge in the market.
Source: TradingView