A noteworthy turn of events for the Avalanche (AVAX) cryptocurrency, bulls are eyeing a potential rise to $32 after a strong display of resilience at the $27 price level. Following a period of bearish sentiment, AVAX has shown renewed momentum, leading to a wave of short liquidations that may further fuel its ascent.
After several months marked by lower lows, AVAX appears to have shifted gears, breaking above key short-term resistance at the $27 level. This breakthrough suggests that the cryptocurrency could be on the cusp of a bullish trend. Market analysts believe that if AVAX can maintain its recent rally, it may very well reach the $32 mark in the near future.
Recent data from Hyblock Capital highlights a significant increase in net short positions on Binance just prior to this upward movement, particularly between September 23 and 24. This accumulation of shorts created a scenario ripe for liquidation when AVAX’s price began to rise, putting additional pressure on short sellers and contributing to the bullish sentiment.
The surge in buy volume on September 24 coincided with the liquidations of short positions. AMBCrypto reported notable buying activity, further explaining AVAX’s ability to push above resistance levels. In addition to the buy volume, there was also a resurgence of long positions, which had dipped earlier in the session.
Liquidations often pave the way for increased bullish momentum, especially when paired with spikes in demand. Recent heat map data indicates a notable increase in liquidations at the $28.20 price level within the past 24 hours. However, despite this bullish activity, the momentum has shown signs of slowing down, with AVAX experiencing a 2.71% dip in the last day.
As of the latest update, AVAX is trading at approximately $27.67. Nonetheless, when examining AVAX’s longer-term chart, a cup and handle pattern has emerged, indicating that it may be in the early stages of a recovery uptrend. If this pattern holds, it suggests a bullish bias for the upcoming weeks or even months.
On-chain metrics further support the bullish outlook for AVAX. Data indicates a significant inflow of AVAX into large holder addresses, which peaked at 4.97 million coins this week. In contrast, large holder outflows reached 3.67 million coins during the same timeframe. Although the inflows have slowed to 2.45 million AVAX as of September 24, they still outweigh the outflows of 1.34 million AVAX.
This disparity in inflows versus outflows points to sustained demand, suggesting that the bulls maintain a dominant position in the market even amidst fluctuations.
With a target of $32 in sight, the coming days will be critical for AVAX. Market participants will be closely monitoring the price action to see if the bullish momentum can be sustained. Should AVAX successfully hold above the $27 resistance level and continue to attract buying interest, it could very well set the stage for a significant rally.
As the cryptocurrency market continues to evolve, AVAX’s ability to attract investment will play a crucial role in determining its short-term and long-term trajectory. Traders and investors alike are advised to stay alert to market signals as AVAX navigates this pivotal moment in its journey.
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