Recent data shows a surge in several address metrics, most notably active addresses — a positive sign for AVAX.

Whales likely drove the increase in active addresses and the rise in USD balances held by large accounts.

Avalanche [AVAX]’s price has fallen 14.05% in the past 24 hours, extending losses this week to 29.12%. Despite this bearish trend, a shift in market sentiment could be around the corner.

According to AMBCrypto, whale activity appears to be intensifying, which could see AVAX enter a new market phase.

The increase in the number of addresses indicates increased market interest

With a simultaneous surge in active addresses (AA) and new addresses (NA), interest in AVAX in the market is rising.

In the past week, AA has increased by 44.50%, indicating a rise in trading volume among existing participants. Meanwhile, NA has surged by 142.90%, suggesting that the adoption rate of AVAX is steadily increasing, likely due to new market entrants finding the asset attractive.

The combination of increased market participation and the inflow of new addresses is a bullish indicator, suggesting that the market may exhibit an upward trend.

According to AMBCrypto, large holders or 'whales' may be driving this growth by accumulating millions of dollars worth of AVAX, leading to a surge in activity.

Whales are hoarding AVAX.

The purchase volume of AVAX across various address categories has significantly increased, especially among addresses holding between $1 million to $10 million worth of AVAX in the past 7 days.

During this period, the number of addresses in this range grew by 24.08%, indicating that whales are gradually entering the market.

Other categories have also observed similar growth trends: addresses holding between $100,000 and $1 million of AVAX grew by 20.13%, while those holding between $10,000 and $100,000 grew by 23.56%.

The collective accumulation by large traders indicates a positive outlook. When the market sentiment of these key participants aligns, it often signifies a healthy buying trend that could drive the token price higher from current levels.

The supply of AVAX is gradually decreasing.

The available money supply in the market is steadily decreasing, and the net outflow from exchanges has significantly dropped.

In just the past 24 hours, AVAX worth $9.61 million has been withdrawn from exchanges, bringing the weekly net outflow to $69.21 million— the highest level since April 4, 2022.

Meanwhile, the weighted funding rate of open contracts has returned to positive territory, indicating that mature traders are preparing for a potential rebound.

If market sentiment decisively shifts towards bullish momentum, AVAX could experience a significant price increase, recovering from weeks of decline.