AVAX Surges 3.05% as Traders Accumulate, Bullish Pattern Emerges

Coin WorldFriday, Jan 31, 2025 8:00 am ET
1min read

Avalanche's native token, AVAX, appears to be reversing its recent price decline, sparking interest among traders and investors. The altcoin has surged by over 3.05% in the last 24 hours, trading near $34.60. However, participation has dropped by 15%, suggesting that market participants may be waiting for further confirmation or a shift in sentiment.

Despite the decline in participation, traders have shown strong interest in AVAX. On-chain analytics firm Coinglass reported that AVAX's Open Interest (OI) climbed by 6.50% in the last 24 hours, indicating the formation or buildup of new positions on both long and short sides. Additionally, investors and long-term holders have begun accumulating tokens, with exchanges seeing outflows of AVAX worth $3.54 million in the last 24 hours, potentially driving buying pressure and further upside rallies.

AVAX's bullish activity has been driven by its strong price action. According to AMBCrypto's technical analysis, AVAX formed a bullish inverted head and shoulders pattern on the four-hour time frame, poised for a breakout at press time. If AVAX breaches the pattern and closes a four-hour candle above the $35-level, there is a strong possibility it could initially rise by 8.50% to hit $38. If sentiment remains unchanged, it could further soar by 25% to touch $41.50 in the future.

However, AVAX was still trading below the 200 Exponential Moving Average (EMA) on the four-hour time frame at press time, indicating a downtrend. Its Relative Strength Index (RSI) of 53 suggested that it has the potential to continue its rally in the coming days.

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