Avalanche is Close to a Bullish Rally. Here’s Why

We will explore the recent update in the network with the chances of a price bullish rally. But before diving into that, let’s delve into the current market situation. 

Current Market Outlook of Avalanche

With the new upgrade in play, AVAX is trading around the $17.20 price mark with daily losses exceeding 1%. Surprisingly, the daily trading volume of AVAX has increased more than 70% over the last day, according to CoinMarketCap. The asset is holding the 16th market position based on the market cap of the asset. Historical data also reveals this asset has lost more than 85% from its all-time high of $146. The developers have introduced a new upgrade on the network which has the full support of the development team. The update is compatible with v1.8.0. 

CoinMarketCap

Avalanche [AVAX] devs recently released AvalancheGo@v1.8.6, a new upgrade. This version is interoperable with the optional but strongly advised v1.8.0.

In addition to the release of this new upgrade, the AVAX community has recently experienced a number of encouraging developments. These have improved the blockchain's worth. These events were also reflected in the price of AVAX, which increased by 2% over the previous day.

To understand the price trajectory of the asset in the coming days, let’s look at what other developments are happening in the Avalanche ecosystem.

Moving On….

Avalanche [AVAX] has generated some buzz in the cryptocurrency sector as a result of recent positive changes to its network. Many traders have shown interest in this. For instance, it was recently discovered that AVAX's total transaction count, including all subnets, hit an all-time high of 3,916,369 transactions.

Twitter

Additionally, in the following days, the amount of gas consumed rose sharply to an all-time high (ATH) of 722,479,684,418 gas. The increased network activity that these events indicate appeared to be very positive for the token. The question still remains, though, whether these could incite AVAX's upcoming bull run.

Updates like the ones stated above suggest that users have been becoming more active. It's interesting to note that the number of addresses varied between 36,000 and 40,000 even as the volume of transactions increased. Therefore, it may be concluded that existing addresses, rather than new users, were responsible for the increase. It's also interesting to note that Avalanche also celebrated its second birthday last week.

 Furthermore, these changes had no impact on AVAX's chart, which showed a negative 24-hour loss of 1%. AVAX had a market value of $5,043,721,718 as of the time of publication and was trading around $17.3. AVAX's metrics, on the other hand, offered a more optimistic view of the token's future as most of them pointed to an increase. As an illustration, the recent sharp surge in AVAX's development activity is encouraging for a blockchain.

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Even with all the encouraging updates, AVAX has not been able to win over investors. This was clear from the social volume metric reading, which showed a drop.  AVAX's trading volume also fell precipitously – bad news for the coin.

Let’s look at the technical analysis and try to predict whether Avalanche is close to a bullish rally or not. 

What’s Next?

The Avalanche network is seeing a huge number of developments in its ecosystem. AVAX is testing its key resistance around the $17.50 price mark. For the last couple of days, the asset has tried to break above $18 but has failed to do so. This failure has resulted in key support becoming the resistance. Presently, the asset is trying to break this current result level. If the asset fails to cross this level, it might fall to the $16 price level. 

         Trading Volume

The statistics and all the system advancements for AVAX have been delivering conflicting indications. Interestingly, CryptoQuant's data showed that AVAX's Relative Strength Index (RSI), a market bottom indicator, was in an oversold position. As a result, a northward price movement is probable. The popularity and trading volume declines for AVAX, however, may still prevent its price from increasing. 

Conclusion

Despite several developments in the Avalanche ecosystem, the price of the asset is showing a mixed result. The support and  resistance levels in the chart will clear out things. Not financial advice!!