AVAX is the first layer blockchain currency of the Avalanche smart contract and is currently trading at 28.25. Why do I feel that AVAX will continue to rise and perform well in this bull market?
Avalanche demand is not due to FOMO
Avalanche is not the only altcoin that has recovered in the past 24 hours. Many other coins in the top 20 by market cap have done the same. However, not all cryptocurrencies have been able to sustain the rally. But AVAX is not one of them.
First, we looked at social search volume. Avalanche’s social search volume has reached new highs since June 27 and remains healthy at press time. Social dominance measures the level of searches for a cryptocurrency. Typically, random searches for an asset rise when there are major developments.
For example, Solana (SOL) experienced a surge in the index. This was prompted by the growth in the number of applications for the Solana ETF, indicating that participants bought it due to FOMO. This means that positive developments triggered demand for SOL and a rally.
In the case of AVAX, there is no such thing. Therefore, the rise in social volume seems natural, reflecting a strong rise in trust. If the index continues to rise, AVAX may avoid a pullback. Instead, it may experience a more significant rise than the 6.32% recorded in the past 24 hours. The historical data also supports this trend, with the coin rising sharply to 36.80 on June 6.
Support appears, ready to rise?
Like social volume, the In/Out of Money Around Price (IOMAP) index supports higher values for AVAX in the short term. IOMAP measures the price range at which currency holders are buying their tokens. With this indicator, traders can identify areas of support or resistance. The more addresses accumulate at a certain point, the more support or resistance it is for AVAX.
IOMAP shows that 4,100 addresses bought 2.62 million AVAX at an average price of 28.54. Meanwhile, 53,540 addresses bought 1.21 million tokens at an average price of 27.29.
While those who bought at 28.54 are losing money, those who bought at $28.54 are making profits. Therefore, the upside is likely to support the rise of AVAX, which may help the cryptocurrency surpass the resistance at 28.54.
Buying pressure keeps it rising
The daily chart has a similar view to the on-chain analysis above. This is reflected in the Fibonacci retracement indicator, which indicates whether a cryptocurrency will continue its current trend or reverse. It determines price milestones to be reached or levels that can reverse. As of the time of this article’s publication, AVAX is approaching resistance at 28.54, which is the 0.238 Fibonacci level.
Additionally, the CMF index has also left negative territory. CMF measures cash flow. Combined with other indicators, it can use buying or selling pressure levels to show if a trend will continue. Therefore, a move up to 0.04 means that Avalanche tokens are being bought.
If this continues, the AVAX price might reach the first target of 31.39. If the bulls succeed in surpassing any potential resistance, AVAX might pull higher. However, this prediction might be invalidated if the demand for the token declines. CMF is another factor that might drag down the AVAX price. If the CMF reaches 0.20, the cryptocurrency will be overbought. If this happens, the price might drop. In the case of an extreme decline, it will drop by 23.92.
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