Avalanche Price Analysis: Active Addresses Increase 2x, AVAX Price Struggles

12:41 pm
June 29, 2023

The number of active addresses on the Avalanche blockchain has doubled compared to the yearly average, reaching 1.21 million. Despite this increase in network activity, the price of AVAX has been trading lower, possibly influenced by Bitcoin’s struggle to maintain its value above $30k.

Avalanche, developed by Ava Labs, has experienced a consistent rise in active addresses over the past month, as shown by on-chain data. This surge in activity has been primarily focused on decentralized exchanges like Trader Joe and the Web3 protocol Galxe, as per crypto market intelligence provider Messari.

While the network activity is growing, it remains to be seen if AVAX price can benefit from it. The platform aims to strengthen its DeFi ecosystem and regain market share, but the current Total Value Locked (TVL) has decreased from $13.93 billion in December 2021 to approximately $1.4 billion.

AVAX Price Outlook

In the past week, AVAX has faced resistance near the $13.70 level, leading to a downward trend. The cryptocurrency has declined by 3% in the last 24 hours and 5% in the past seven days. AVAX bulls are now attempting to prevent further decline by defending the $12.50 support level.

If Bitcoin experiences a significant increase in price, it could potentially inject positive momentum into altcoins like AVAX. This might lead AVAX/USD to reclaim the $14 area and potentially reach April’s peak of $20, representing a 100% increase from the June lows of $10.

However, the daily price chart indicates some weakness for AVAX. The RSI is below the 50-mark, suggesting reduced buying pressure after the previous surge in price. The MACD also indicates weakness among buyers. A reversal in the indicators could indicate potential gains, while the opposite might signal a return to the key support range between $11.20 and $9.50.

Avalanche daily chart. Source: TradingView

FAQ

What is Avalanche?

Avalanche is a layer 1 blockchain developed by Ava Labs. It aims to revitalize its network and foster a stronger DeFi ecosystem.

Why has the number of active addresses on Avalanche increased?

According to data from Avalanche explorer Avascan, the number of active addresses on the network has doubled, reaching 1.21 million. The increase in network activity has been driven by engagement in decentralized exchanges such as Trader Joe and Web3 protocol Galxe.

What is the outlook for AVAX price?

The AVAX price has been trading lower recently, influenced by Bitcoin’s struggle to maintain its value above $30k. However, if Bitcoin experiences a significant increase in price, it could potentially inject positive momentum into altcoins like AVAX. There is a possibility that AVAX/USD might reclaim the $14 area and reach its previous peak of $20.

What are the indicators for AVAX price?

The daily price chart for AVAX shows that the RSI is below the 50-mark, suggesting reduced buying pressure. The MACD also indicates weakness among buyers. A reversal in these indicators could indicate potential gains for AVAX, while the opposite might signal a return to the key support range between $11.20 and $9.50.


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