NOIDA (CoinChapter.com)—DeFi platform Avalanche’s native token AVAX started the current week in the red on June 10 before bulls recovered some of their losses in a late push. Bullish indicators and heightened market interest might explain why the Avalanche price is up today.
AVAX price dropped drastically over the past 7 days, but the Avalanche token started recovering on June 9. However, bearish pressure against the token remains, which curtailed the bulls’ efforts to continue June 9’s uptrend.
Technicals Help AVAX Price Surge
Market interest and trading volumes for AVAX spiked, driven by renewed investor confidence in Avalanche’s network and DeFi capabilities. The network’s claimed ability to handle high transaction volumes efficiently also likely attracted more investors.
This increased demand, coupled with favorable technical conditions, likely created a conducive environment for AVAX’s price to climb. Furthermore, the broader cryptocurrency market has seen a resurgence in bullish sentiment, with many altcoins experiencing similar upward trends.
Moreover, data from DeFiLlama shows a stable Total Value Locked (TVL) in Avalanche (AVAX), with a notable spike in April. The stability indicates consistent user trust and capital retention within the ecosystem.
The sustained TVL indicates demand for Avalanche-based DeFi applications is growing, which can increase demand for AVAX and positively impact its price. Additionally, a steady TVL could help increase investor confidence and buying pressure on AVAX.
Additionally, the consistent positive funding rate suggests that long positions dominate the market, indicating traders are willing to pay a premium to maintain their bullish bets on AVAX.
The relatively high and stable OI reinforces the sentiment, which signifies increased trader activity and confidence in the asset. As more money flows into the market and traders continue to hold long positions, the demand for AVAX is likely to rise, driving its price upward.
Avalanche Price Up Today In Anticipation Of Bullish Pattern Breakout
AVAX price has formed a bullish technical pattern called the ‘falling wedge.’
A falling wedge pattern features a pair of converging trend lines connecting lower highs and lower lows, forming a narrowing shape that slopes downward.
The pattern typically suggests that an asset’s price, while consolidating in a downtrend, is losing bearish momentum and preparing for a potential reversal to the upside. Typically, a breakout occurs in the direction of the overall trend, which, for a falling wedge, is upward.
To estimate the price target of a falling wedge pattern, traders measure the widest part of the wedge at the beginning of the formation. They then project this distance upward from the point of the breakout to set a potential target.
An accompanying increase in trading volume can further confirm the reliability of the breakout. Higher volume during the breakout suggests stronger market conviction, supporting the likelihood of a successful price reversal.
According to the rules of technical analysis, the Avalanche token price could rally nearly 100% to reach the pattern’s theoretical price target near $64.6.
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